Figure Technology Solutions, Inc.FIGR
Figure Technology Solutions, Inc. Fair Value Disclosure
FAIR VALUE MEASUREMENTS
Assets and Liabilities Recorded at Fair Value on a Recurring Basis
The following table summarizes information about the assets and liabilities that are measured at fair value on a recurring basis at December 31, 2025 and 2024:
| December 31, 2025 | |||||||||||||||||||||||||||||
| Carrying Value | Fair value | ||||||||||||||||||||||||||||
| Level 1 | Level 2 | Level 3(A) | Total | ||||||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||||||||
| Cash and cash equivalents | $ | 1,198,141 | $ | 955,200 | $ | 242,941 | $ | — | $ | 1,198,141 | |||||||||||||||||||
| Restricted cash | 68,637 | 68,637 | — | — | 68,637 | ||||||||||||||||||||||||
Digital assets(B) | 88,511 | 88,511 | — | — | 88,511 | ||||||||||||||||||||||||
Distressed asset claims(C) | 3,068 | — | — | 3,068 | 3,068 | ||||||||||||||||||||||||
Marketable securities, at fair value(D) | 273,151 | — | 232,985 | 40,166 | 273,151 | ||||||||||||||||||||||||
Loans held for sale, at fair value (E) | 404,337 | — | — | 404,337 | 404,337 | ||||||||||||||||||||||||
Loan servicing assets, at fair value (E) | 113,064 | — | — | 113,064 | 113,064 | ||||||||||||||||||||||||
Treasury note futures (F) | 442 | 442 | — | — | 442 | ||||||||||||||||||||||||
| Total assets | $ | 2,149,351 | $ | 1,112,790 | $ | 475,926 | $ | 560,635 | $ | 2,149,351 | |||||||||||||||||||
| Liabilities: | |||||||||||||||||||||||||||||
Digital asset collateral repayment obligation(G) | $ | 52,569 | $ | 52,569 | $ | — | $ | — | $ | 52,569 | |||||||||||||||||||
Certificate repayment obligation(G) | 266,654 | — | 266,654 | — | 266,654 | ||||||||||||||||||||||||
| Total liabilities | $ | 319,223 | $ | 52,569 | $ | 266,654 | $ | — | $ | 319,223 | |||||||||||||||||||
| December 31, 2024 | |||||||||||||||||||||||||||||
| Carrying Value | Fair value | ||||||||||||||||||||||||||||
| Level 1 | Level 2 | Level 3(A) | Total | ||||||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||||||||
Cash and cash equivalents(H) | $ | 289,670 | $ | 289,670 | $ | — | $ | — | $ | 289,670 | |||||||||||||||||||
| Restricted cash | 57,777 | 57,777 | — | — | 57,777 | ||||||||||||||||||||||||
Digital assets(B)(H) | 83,622 | 83,622 | — | — | 83,622 | ||||||||||||||||||||||||
Distressed asset claims(C) | 7,589 | — | — | 7,589 | 7,589 | ||||||||||||||||||||||||
Marketable securities, at fair value(D) | 163,489 | — | 128,983 | 34,506 | 163,489 | ||||||||||||||||||||||||
Loans held for sale, at fair value (E) | 395,922 | — | — | 395,922 | 395,922 | ||||||||||||||||||||||||
Loan servicing assets, at fair value (E) | 88,497 | — | — | 88,497 | 88,497 | ||||||||||||||||||||||||
| Total assets | $ | 1,086,566 | $ | 431,069 | $ | 128,983 | $ | 526,514 | $ | 1,086,566 | |||||||||||||||||||
| Liabilities: | |||||||||||||||||||||||||||||
Digital asset collateral repayment obligation(G) | $ | 64,447 | $ | 64,447 | $ | — | $ | — | $ | 64,447 | |||||||||||||||||||
| Total liabilities | $ | 64,447 | $ | 64,447 | $ | — | $ | — | $ | 64,447 | |||||||||||||||||||
(A) There were no transfers of Level 3 instruments to, or from, other fair value levels during the periods presented.
(B) Included in “Digital assets” and “Digital assets, non-current” in the Consolidated Balance Sheets and represents digital assets held for sale at fair value, and excludes digital assets held at cost that are considered intangible assets.
(C) Included in “Other current assets” in the Consolidated Balance Sheets.
(D) Residual interest securities and non-rated securities in securitizations not considered debt securities are included within Level 3 of the fair value hierarchy.
(E) See Notes 4 and 5 regarding changes in the carrying values of servicing assets and loans, respectively.
(F) Treasury note future assets are recorded in “Other current assets”, and treasury note future liabilities in “Other current liabilities" in the Consolidated Balance Sheets.
(G) Included in “Debt, current” in the Consolidated Balance Sheets.
(H) During the current period, we reclassified payment stablecoins from “Digital assets” to “Cash and cash equivalents”. Prior period amounts have been recast to conform to the current period presentation. This reclassification resulted in an increase to “Cash and cash equivalents” and a corresponding decrease to “Digital assets” of $2.4 million as of December 31, 2024. For further information, see Note 2, Change in Accounting Principle, to the Consolidated Financial Statements.
Significant Valuation Inputs
The Company used the following unobservable inputs that it considers significant to value the financial assets and liabilities carried at fair value and classified within Level 3 of the fair value hierarchy:
| December 31, 2025 | |||||||||||||||||||||||||||||||||||
| Fair Value | Discount Rate (A) (%) | CPR (B) (%) | CDR (C) (%) | Servicing Rate (D) (%) | Loss Severity (E) (%) | ||||||||||||||||||||||||||||||
| Marketable securities: | |||||||||||||||||||||||||||||||||||
| Residual interest securities | $ | 40,166 | 9.6% - 25.8% 15.7% | 16.2% - 20.8% 18.8% | —% - 2.4% 1.2% | n.a. | n.a. | ||||||||||||||||||||||||||||
| Servicing assets: | |||||||||||||||||||||||||||||||||||
| HELOC loans | $ | 111,211 | 13.0% - 13.0% 13.0% | —% - 33.1% 13.3% | —% - 4.8% 0.8% | 0.3% | n.a - n.a n.a | ||||||||||||||||||||||||||||
| Mortgage loans | 1,853 | 9.5% - 10.5% 10.3% | 3.5% - 8.2% 5.3% | —% - 10.5% 0.4% | 0.3% | n.a. | |||||||||||||||||||||||||||||
Total / Weighted average(F) | $ | 113,064 | 13.0% | 13.2% | 0.7% | 0.3% | |||||||||||||||||||||||||||||
| Loans held for sale: | |||||||||||||||||||||||||||||||||||
HELOC loans(G) | $ | 320,566 | 5.7% - 7.8% 6.4% | 1.1% - 47.4% 17.8% | —% - 94.0% 1.8% | n.a. | —% - 99.1% 25.4% | ||||||||||||||||||||||||||||
Personal loans(H) | 79,113 | 8.9% - 11.5% 9.8% | —% - —% —% | —% - —% —% | n.a. | —% - —% —% | |||||||||||||||||||||||||||||
Other(I) | 4,658 | 6.2% - 12.0% 7.6% | 4.6% - 73.2% 26.1% | 1.0% - 62.8% 9.6% | n.a. | 88.0% - 92.0% 90.0% | |||||||||||||||||||||||||||||
Total / Weighted average(F) | $ | 404,337 | 6.5% | 18.0% | 1.9% | ||||||||||||||||||||||||||||||
| December 31, 2024 | |||||||||||||||||||||||||||||||||||
| Fair Value | Discount Rate(A) (%) | CPR(B) (%) | CDR(C) (%) | Servicing Rate(D) (%) | Loss Severity (E) (%) | ||||||||||||||||||||||||||||||
| Marketable securities: | |||||||||||||||||||||||||||||||||||
| Residual interest securities | $ | 34,506 | 14.5% - 24.0% 19.7% | 15.2% - 20.1% 17.7% | 1.5% - 1.7% 1.6% | n.a | n.a | ||||||||||||||||||||||||||||
| Servicing assets: | |||||||||||||||||||||||||||||||||||
| HELOC loans | $ | 86,465 | 13.0% - 13.0% 13.0% | 1.0% - 33.0% 14.4% | —% - 4.4% 0.7% | 0.2% | n.a | ||||||||||||||||||||||||||||
| Mortgage loans | 2,032 | 10.0% - 11.0% 10.8% | 3.9% - 8.2% 5.7% | —% - 1.0% 0.2% | —% | n.a | |||||||||||||||||||||||||||||
Total / Weighted average(F) | $ | 88,497 | 12.9% | 14.2% | 0.7% | 0.2% | |||||||||||||||||||||||||||||
| Loans held for sale: | |||||||||||||||||||||||||||||||||||
HELOC loans(G) | $ | 366,154 | 6.4% - 10.1% 7.6% | 1.3% - 32.4% 13.6% | 1.5% - 1.7% 1.6% | n.a | 16.6% - 44.2% 32.4% | ||||||||||||||||||||||||||||
Other(I) | 3,829 | 5.1% - 8.7% 6.9% | 17.9% - 99.7% 25.6% | 0.4% - 10.2% 7.7% | n.a | 88.0% - 92.0% 90.0% | |||||||||||||||||||||||||||||
Total / Weighted average(F) | $ | 369,983 | 7.6% | 13.7% | 1.7% | ||||||||||||||||||||||||||||||
(A) Significant increases (decreases) in the discount rate, in isolation, would result in a significantly lower (higher) fair value measurement.
(B) Significant increases (decreases) in the CPR, in isolation, would result in a significantly lower (higher) fair value measurement.
(C) Significant increases (decreases) in the CDR, in isolation, would result in a significantly lower (higher) fair value measurement.
(D) Significant increases (decreases) in the servicing rate in excess of servicing costs, in isolation, would result in a significantly higher (lower) fair value measurement. Values represent the weighted average total mortgage servicing amount, net of subservicing costs.
(E) Significant increases (decreases) in the severity, in isolation, would result in a significantly lower (higher) fair value measurement.
(F) Unobservable inputs were weighted by respective fair value of each class.
(G) HELOC loans are measured at estimated fair value using a discounted cash flow valuation methodology, more specifically a residential mortgage cash flow model.
(H) Personal loans are measured at estimated fair value using a discounted cash flow valuation methodology, more specifically a loan cash flow model.
(I) Personal unsecured loans included in “Other” are measured at estimated fair value using a discounted cash flow valuation methodology, more specifically a loan cash flow model. The Company uses an estimated recovery from collections and recent sales to fair value personal loans that are 30 days past due; the fair value of such loans at December 31, 2025 and 2024 were not material.
Significant Valuation Input Sensitivity
The following tables summarize the estimated change in fair value of assets carried at fair value and classified within Level 3 of the fair value hierarchy for the unobservable inputs in “—Significant Valuation Inputs” at December 31, 2025. Each of the following sensitivity analyses is hypothetical and is provided for illustrative purposes only. There are certain limitations inherent in the sensitivity analyses presented. In particular, the results are calculated by stressing a particular economic assumption independent of changes in any other assumption; in practice, changes in one factor may result in changes in another, which might counteract or amplify the sensitivities. Also, changes in the fair value based on the following variations in an assumption generally may not be extrapolated because the relationship of the change in the assumption to the change in fair value may not be linear.
| -2% | -1% | +1% | +2% | ||||||||||||||||||||||||||||||||
| $ | % | $ | % | $ | % | $ | % | ||||||||||||||||||||||||||||
| Discount rate: | |||||||||||||||||||||||||||||||||||
| Marketable securities: | |||||||||||||||||||||||||||||||||||
| Residual interest securities | $ | 1,408 | 7.7 | % | $ | 659 | 3.6 | % | $ | (653) | (3.6) | % | $ | (1,275) | (7.0) | % | |||||||||||||||||||
Servicing assets: | |||||||||||||||||||||||||||||||||||
| HELOC loans | 6,793 | 6.3 | 3,289 | 3.0 | (3,105) | (2.9) | (6,025) | (5.6) | |||||||||||||||||||||||||||
| Mortgage loans | (187) | (10.1) | (90) | (4.8) | 82 | 4.4 | 158 | 8.5 | |||||||||||||||||||||||||||
| Loans held for sale: | |||||||||||||||||||||||||||||||||||
| HELOC loans | 16,724 | 3.7 | 12,418 | 2.7 | (15,234) | (3.3) | (30,126) | (6.6) | |||||||||||||||||||||||||||
| Personal loans | 15 | 1.1 | 7 | 0.5 | (7) | (0.5) | (14) | (1.0) | |||||||||||||||||||||||||||
| -20% | -10% | +10% | +20% | ||||||||||||||||||||||||||||||||
| $ | % | $ | % | $ | % | $ | % | ||||||||||||||||||||||||||||
| CPR: | |||||||||||||||||||||||||||||||||||
| Marketable securities: | |||||||||||||||||||||||||||||||||||
| Residual interest securities | $ | 2,970 | 16.4 | % | $ | 1,407 | 7.8 | % | $ | (1,269) | (7.0) | % | $ | (2,814) | (15.6) | % | |||||||||||||||||||
Servicing assets: | |||||||||||||||||||||||||||||||||||
| HELOC loans | 6,815 | 6.3 | 3,299 | 3.1 | (3,094) | (2.9) | (6,004) | (5.6) | |||||||||||||||||||||||||||
| Mortgage loans | (98) | (5.3) | (48) | (2.6) | 46 | 2.5 | 90 | 4.9 | |||||||||||||||||||||||||||
| Loans held for sale: | |||||||||||||||||||||||||||||||||||
| HELOC loans | 1,068 | 0.2 | 570 | 0.1 | (813) | (0.2) | (1,636) | (0.4) | |||||||||||||||||||||||||||
| Personal loans | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
| CDR: | |||||||||||||||||||||||||||||||||||
| Marketable securities: | |||||||||||||||||||||||||||||||||||
| Residual interest securities | 723 | 4.0 | 347 | 1.9 | (388) | (2.2) | (743) | (4.1) | |||||||||||||||||||||||||||
Servicing assets: | |||||||||||||||||||||||||||||||||||
| HELOC loans | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
| Loans held for sale: | |||||||||||||||||||||||||||||||||||
| HELOC loans | 1,655 | 0.4 | 816 | 0.2 | (930) | (0.2) | (1,820) | (0.4) | |||||||||||||||||||||||||||
| Personal loans | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
| Servicing rate: | |||||||||||||||||||||||||||||||||||
Servicing Assets | |||||||||||||||||||||||||||||||||||
| HELOC loans | 9,022 | 8.3 | 4,511 | 4.2 | (4,511) | (4.2) | (9,022) | (8.3) | |||||||||||||||||||||||||||
Marketable Securities
The following table summarizes activities involving the Company’s marketable securities that are measured at fair value and classified within Level 3 of the fair value hierarchy for the years ended December 31, 2025 and 2024:
| Balance at December 31, 2023 | $ | 11,952 | |||
Purchases(A) | 24,440 | ||||
| Sales | (872) | ||||
| Principal payments | (2,184) | ||||
Change in fair value(B) | 1,170 | ||||
| Balance at December 31, 2024 | $ | 34,506 | |||
Purchases(A) | 15,968 | ||||
| Sales | — | ||||
| Principal payments | (11,582) | ||||
Change in fair value(B) | 1,274 | ||||
| Balance at December 31, 2025 | $ | 40,166 | |||
(A) Includes premiums paid on the purchased notes.
(B) Included in “Gain on sale of loans, net” in the Consolidated Statements of Operations.
Assets and Liabilities Not Measured at Fair Value on a Recurring Basis
The following table summarizes information about the liabilities that are not measured at fair value on a recurring basis at December 31, 2025 and 2024:
| December 31, 2025 | |||||||||||||||||||||||||||||
| Carrying Value | Fair Value | ||||||||||||||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||||||
| Liabilities: | |||||||||||||||||||||||||||||
Financed retained interests(A) | $ | 231,633 | $ | — | $ | 233,684 | $ | 39,467 | $ | 273,151 | |||||||||||||||||||
| Total liabilities | $ | 231,633 | $ | — | $ | 233,684 | $ | 39,467 | $ | 273,151 | |||||||||||||||||||
| December 31, 2024 | |||||||||||||||||||||||||||||
| Carrying Value | Fair Value | ||||||||||||||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||||||
| Liabilities: | |||||||||||||||||||||||||||||
Financed retained interests(A) | $ | 128,101 | $ | — | $ | 127,327 | $ | — | $ | 127,327 | |||||||||||||||||||
| Total liabilities | $ | 128,101 | $ | — | $ | 127,327 | $ | — | $ | 127,327 | |||||||||||||||||||
(A) Financed retained interests classified as Level 2 in the fair value hierarchy were valued with a discounted cash flow model using collateral contractual terms and discount rates of similar instruments that include default and prepayment expectations as observable inputs.
Debt not carried at fair value, including financed retained interests, is presented at the face amount, net of debt issuance costs that are amortized over the contractual term using the effective interest method. The carrying value of debt associated with the warehouse facilities and servicing rights financing approximates the fair value due to their relatively short maturities.
Assets Measured at Fair Value on a Non-recurring Basis
Digital Assets
The Company held HASH at cost, net of impairment, totaling $11.7 million and $1.5 million at December 31, 2025 and 2024, respectively, as intangible assets presented within “Digital assets” in the Consolidated Balance Sheets. In connection with a valuation that management performed with the assistance of a third-party specialist during the Reorganization, the Company determined an impairment indicator existed for the HASH it held. Therefore, the Company recognized an impairment charge of $5.9 million, equal to the difference between the fair value and cost basis of HASH, in “Other (expense) income, net” in the Consolidated Statements of Operations during the year ended December 31, 2024. There were no impairment charges during the year ended December 31, 2025 or 2023Free Sentinel
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About Fair Value Disclosures
Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.
Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.