Commitments and Contingencies
 
From time to time, the Company may become involved in various claims and legal actions arising in the ordinary course of business. As of December 31, 2025, the Company was not involved in any material legal proceedings.
The below table details the Company's outstanding commitments as of December 31, 2025 (in thousands).
Commitment TypeDate of CommitmentTotal CommitmentFunded CommitmentRemaining Commitment
Agency-Eligible Loans (1)Various$492 $— $492 
Home Equity Loans (2)Various150,076 135,804 14,272 
Total$150,568 $135,804 $14,764 
(1)The Company entered into forward purchase commitments to acquire certain loans from Arc Home which have not yet settled as of December 31, 2025. The total commitment amount represents the agreed upon purchase price of any outstanding unpaid principal balance the Company has committed to purchase. Refer to Note 10 "Transactions with affiliates" for more information.
(2)Represents the undrawn portion of a borrowers' home equity line of credit for which the Company may be required to fund including $10.7 million, $2.3 million, and $1.3 million related to "Residential mortgage loans, at fair value," "Real estate securities, at fair value," and "Securitized residential mortgage loans, at fair value," respectively.
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About Commitments Disclosures

Commitments and contingencies disclosures catalog a company's off-balance-sheet obligations and legal exposures — purchase commitments, guarantee arrangements, pending litigation, and regulatory proceedings. These items represent potential future cash outflows that may not appear as liabilities on the balance sheet until they become probable and estimable.

Key signals: litigation reserves and disclosed loss ranges quantify management's estimate of legal exposure, but unquantified "reasonably possible" losses often represent the larger risk. Watch for changes in language around pending cases — shifts from "remote" to "reasonably possible" or increases in estimated loss ranges signal deteriorating outcomes. Unconditional purchase obligations and take-or-pay contracts create fixed cost structures that reduce operational flexibility. Guarantee arrangements for subsidiaries or joint ventures can create cascading obligations. Compare the total commitment schedule against projected free cash flow to assess whether the company can meet its obligations without additional financing.