Velocity Financial, Inc. ( (VEL) ) has released its Q3 earnings. Here is a breakdown of the information Velocity Financial, Inc. presented to its investors.
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Velocity Financial, Inc. is a real estate finance company that specializes in originating and managing business purpose loans secured by residential rental and small commercial properties across the United States.
In its third quarter of 2024, Velocity Financial, Inc. reported significant growth in both net and core income, driven by robust loan production and strategic securitization activities. The company’s financial performance continues to reflect its strong position in the lending market despite broader economic challenges.
Velocity’s third-quarter net income rose to $15.8 million, a 30.8% increase compared to the same period last year, with core net income also improving by 31.2% to $16.9 million. The company’s diluted earnings per share increased to $0.44, while core diluted EPS reached $0.47. Loan production showed a notable 64.1% year-over-year increase, totaling $476.8 million, indicating strong demand across various loan types. The net interest margin improved to 3.60%, reflecting efficient portfolio management. Additionally, the company successfully completed a $253.6 million securitization, which enhanced liquidity and capital efficiency.
Despite the rise in nonperforming loans, which constituted 10.6% of the Held for Investment portfolio, Velocity managed to achieve a net gain of $2.3 million from resolutions. The company’s total loan portfolio reached $4.8 billion, marking a 22.6% increase year-over-year, with a focus on diversifying its holdings across different property types.
Looking forward, Velocity Financial anticipates achieving a record full-year funding, as highlighted by CEO Chris Farrar. The company aims to expand its loan portfolio to $5 billion by 2025, leveraging strong investor demand and strategic capital management to continue its growth trajectory in the real estate finance sector.
