Velocity Financial in Toorak deal, AUM to hit $10B
Rhea-AI Filing Summary
Velocity Financial, Inc. (VEL), through its subsidiary Velocity Commercial Capital, agreed to acquire the operating platform of Toorak Capital via an Equity Purchase Agreement with Toorak Capital LLC. The base purchase price for the Toorak platform is approximately $62 million, plus estimated tangible book value, subject to adjustments and customary closing conditions.
The transaction is paired with a separate “Back Book Acquisition,” under which a third-party investment firm will acquire Toorak’s existing business-purpose loan portfolio of approximately $3 billion unpaid principal balance, while Velocity will manage that portfolio and sell future Toorak production to the firm and other counterparties. The total value of the platform and portfolio transactions is estimated at about $3.2 billion based on Toorak’s June 30 2026 balance sheet, and Velocity expects total assets under management to rise to roughly $10 billion UPB.
Toorak has funded over $20 billion in cumulative loan volume across almost 43,000 loans since 2016, with around 280 employees as of June 30 2026. Velocity expects the combination to increase its 2025-based origination volume by about 76% (to roughly $4.8 billion), grow servicing volume by about 39%, add a capital-light, fee-based business, and be accretive to GAAP earnings in 2027, while initially diluting book value by an estimated 4–6%.
Positive
- Strategic acquisition of Toorak’s platform significantly scales Velocity’s business, adding a capital-light, fee-based lending and asset-management platform with diversified products and origination channels.
- Assets under management expected to rise to ~${10} billion UPB through management of Toorak’s ~$3 billion portfolio, increasing recurring servicing and asset-management fee income.
- Origination volume projected to grow ~76%, from about $2.7 billion to roughly $4.8 billion based on 2025 data, and servicing platform by about 39%, materially increasing operating scale.
- Expected GAAP earnings accretion in 2027 with an attractive return-on-equity profile, supported by fee-based revenues and capital-efficient forward loan sales to partners.
Negative
- Estimated 4–6% book value dilution from the transaction, with management expecting to earn back the dilution over approximately three years.
- Closing risk and regulatory approvals: both the Toorak Acquisition and related Back Book transactions are subject to customary conditions and required approvals, and may be terminated if not completed within 120 days or if prohibited by governmental orders.
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Equity Purchase Agreement regulatory
Master Transaction Agreement regulatory
business-purpose loans financial
debt service coverage ratio financial
securitization financial
forward flow partners financial
FAQ
What transaction did Velocity Financial (VEL) announce with Toorak Capital?
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How large is Toorak’s business-purpose loan portfolio mentioned in the Velocity (VEL) filing?
What is the total estimated value of the Velocity (VEL)–Toorak platform and portfolio transactions?
When is the Velocity Financial (VEL)–Toorak acquisition expected to close?
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
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CURRENT REPORT
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Item 1.01 Entry into a Material Definitive Agreement.
Equity Purchase Agreement
On August 26, 2026, Velocity Commercial Capital, LLC (the “Company”), a wholly-owned subsidiary of Velocity Financial, Inc. (“Velocity”), entered into an Equity Purchase Agreement (the “Purchase Agreement”) with Toorak Capital LLC, a Delaware limited liability company (“Seller”), pursuant to which the Company will purchase from Seller all of the issued and outstanding equity interests of a Delaware limited liability company to be formed through a statutory division of Toorak Capital Partners LLC, MMTC Holdings LLC and MMTC Portfolio Holdings, LLC (collectively, the “Purchased Companies,” and such equity interests, the “Purchased Interests”). Upon the consummation of the transactions contemplated by the Purchase Agreement (the “Toorak Acquisition”), each of the Purchased Companies will become a wholly-owned subsidiary of the Company.
The consideration to be paid by the Company is comprised of a base purchase price of approximately $62 million, plus estimated tangible book value, subject to certain adjustments as described in the Purchase Agreement.
The consummation of the Toorak Acquisition is subject to the satisfaction or waiver of customary closing conditions, including without limitation (i) the absence of any applicable law, order or injunction prohibiting the transactions contemplated by the Purchase Agreement, (ii) the receipt of certain required regulatory approvals, (iii) completion of certain pre-closing transactions, (iv) the accuracy of representations and warranties set forth in the Purchase Agreement and compliance with covenants set forth in the Purchase Agreement (in each case, subject to certain materiality or material adverse effect qualifications), (v) the absence of any material adverse effect with respect to the Purchased Companies and their subsidiaries, (vi) completion, or substantially concurrent completion, of the Back Book Acquisition (as defined below), (vii) the satisfaction of certain warehouse financing-related conditions and (viii) the satisfaction of certain conditions related to the employment of certain employees.
The Purchase Agreement contains certain termination rights for the parties, including, among others, if the Transactions (as defined below) do not close on or before the date that is 120 days following the date of the Purchase Agreement, subject to certain exceptions and extension rights, or if any governmental authority issues a final and non-appealable law or order permanently restraining, enjoining or otherwise prohibiting consummation of the Transactions.
The parties have made customary representations, warranties and covenants in the Purchase Agreement, including covenants relating to (i) Seller causing the Purchased Companies and their subsidiaries to conduct their businesses in the ordinary course between the date of the signing of the Purchase Agreement and the consummation of the Toorak Acquisition, (ii) the parties making required filings and cooperating to obtain necessary approvals from governmental authorities, (iii) Seller completing certain pre-closing transactions and obtaining certain required warehouse facility consents or arranging for certain designated or back-up warehouse facilities and (iv) Seller keeping the Company reasonably apprised of the status of the Back Book Acquisition and not taking certain actions with respect to the Back Book Acquisition without the Company’s prior written consent.
The foregoing summary of the Purchase Agreement and the transactions contemplated thereby does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Purchase Agreement which is filed as Exhibit 2.1 to this Current Report on Form 8-K and incorporated herein by reference.
The Purchase Agreement is being filed to provide investors and security holders with information regarding its terms. It is not intended to provide any other factual information about Seller, the Purchased Companies, the Company or any other parties to the Purchase Agreement. The representations, warranties and covenants of each party set forth in the Purchase Agreement were made only for purposes of the Purchase Agreement as of the specific dates set forth therein, were solely for the benefit of the parties to the Purchase Agreement, may be subject to limitations agreed upon by the contracting parties, including being qualified by confidential disclosures made for the purposes of allocating contractual risk between the parties to the Purchase Agreement instead of establishing these matters as facts, and may be subject to standards of materiality applicable to the contracting parties that differ from those applicable to investors. The Company’s investors and security holders are not third-party beneficiaries under the Purchase Agreement and should not rely on the representations, warranties and covenants or any descriptions thereof as characterizations of the actual state of facts or condition of Seller, the Purchased Companies, the Company, the parties to the Purchase Agreement or any of their respective subsidiaries or affiliates. Moreover, information concerning the subject matter of the representations and warranties may change after the date of the Purchase Agreement, which subsequent information may or may not be fully reflected in the Company’s public disclosures. The Purchase Agreement should not be read alone but should instead be read in conjunction with the other information regarding the Company that is or will be contained in, or incorporated by reference into, the Forms 10-K, Forms 10-Q and other documents that the Company files with the Securities and Exchange Commission (the “SEC”).
Master Transaction Agreement
In connection with the entry into the Purchase Agreement, Seller is concurrently entering into certain agreements with affiliates of TOBI III SPE I LLC (“TOBI” and such agreements, the “Back Book Agreements”) relating to the acquisition by affiliates of TOBI of certain loan assets and securitization equity interests of Seller or its subsidiaries (the “Back Book Acquisition”). In connection with the Back Book Acquisition, the Company is concurrently entering into a Master Transaction Agreement (the “Master Transaction Agreement”) with Titan RR LLC, an affiliate of an affiliate of TOBI, pursuant to which the parties agree to, among other things (a) not amend their respective agreements with Seller without the other party’s consent, (b) enter into certain side letters related to securitization matters following the closing of the Toorak Acquisition and the Back Book Acquisition and (c) subject to the closing of the Toorak Acquisition and the Back Book Acquisition, TOBI will pay to the Company certain fees related to securitization matters (such transactions, together with the Back Book Acquisition and the Toorak Acquisition, the “Transactions”).
The consummation of the transactions contemplated by the Master Transaction Agreement is subject to closing conditions, including the absence of any law or order prohibiting the transactions contemplated by the Master Transaction Agreement and the consummation of the Toorak Acquisition and the Back Book Acquisition. The Master Transaction Agreement contains certain termination rights for the parties, including, among others, if the Purchase Agreement or Back Book Acquisition are terminated or if any governmental authority issues a law or order permanently restraining, enjoining or otherwise prohibiting consummation of the transactions contemplated by the Master Transaction Agreement.
The foregoing summary of the Master Transaction Agreement and the transactions contemplated thereby does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Master Transaction Agreement which is filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.
The Transactions were unanimously approved by Velocity’s disinterested directors.
Item 7.01 Regulation FD Disclosure.
On August 27, 2026, Velocity issued a press release announcing the Transactions. Additionally, in the press release, Velocity announced a conference call for the same date at 5:30 a.m. Pacific Time / 8:30 a.m. Eastern Time to discuss the Transactions. The conference call webcast will be available through the Events and Presentations section of the Velocity Financial Investor Relations website: https://www.velfinance.com/events-and-presentations. Alternatively, participants may access the conference call by dialing 1-646-307-1963 in the U.S. and for international callers using conference ID #5566224 approximately 15 minutes prior to the scheduled start time. Velocity’s website address is included only as an inactive textual reference only and is not intended to be an active link to Velocity’s website. A copy of the press release and the investor presentation to be presented during the conference call are furnished herewith as Exhibit 99.1 and 99.2, respectively.
The information in this Item 7.01, including the corresponding Exhibit 99.1 and 99.2, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities under that section and shall not be deemed to be incorporated by reference into any filings under the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
Cautionary Note Regarding Forward-Looking Statements
This Current Report on Form 8-K includes “forward-looking statements” within the meaning of Section 27A of the Securities Act, as amended and Section 21E of the Exchange Act, as amended. Forward-looking statements are subject to known and unknown risks and uncertainties, many of which may be beyond Velocity’s control. Velocity cautions that the forward-looking information presented in this Current Report is not a guarantee of future events, and that actual events and results may differ materially from those made in, or suggested by, the forward-looking information contained in this Current Report. In addition, forward-looking statements generally can be identified by the use of forward-looking terminology such as “may,” “plan,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “believe,” or “continue,” or the negative thereof, or variations thereon, or similar terminology.
A number of important factors could cause actual events and results to differ materially from those contained in or implied by the forward-looking statements, including, but not limited to: (i) the risk that the proposed Transactions may not be completed in a timely manner or at all, which may adversely affect Velocity’s business; (ii) the failure to satisfy any of the conditions to the consummation of the proposed Transactions, including the receipt of certain regulatory approvals; (iii) the occurrence of any event, change, or circumstance that could give rise to the termination of the proposed Transactions; (iv) the effect of the announcement of the proposed Transactions on the Company’s business relationships, operating results, and business generally; (v) unexpected costs, charges, or expenses resulting from the proposed Transactions; and (vi) other risks described in the risk factors set forth in the Velocity’s filings with the SEC, including the most recent Annual Report on Form 10-K, filed with the SEC on March 12, 2026 and Quarterly Report on Form 10-Q filed with the SEC on August 6, 2026.
Any forward-looking information presented herein is made only as of the date of this Current Report. Except as required by applicable law, Velocity does not undertake any obligation to update or revise any forward-looking information to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit No. |
Description | |
| 2.1* | Equity Purchase Agreement, dated as of August 26, by and between Velocity Commercial Capital, LLC, Velocity Financial, Inc. (solely for the purpose of Section 6.14 therein) and Toorak Capital LLC | |
| 10.1* | Master Transaction Agreement, dated as of August 26, by and between Velocity Commercial Capital, LLC and Titan RR LLC | |
| 99.1 | Press Release, dated August 27, 2026 | |
| 99.2 | Investor Presentation, dated August 27, 2026 | |
| 104 | Cover Page Interactive Data File (embedded within Inline XBRL document) | |
| * | The schedules and exhibits have been omitted from this filing pursuant to Item 601(a)(5) of Regulation S-K. The Company will furnish copies of any such schedules and exhibits to the SEC upon request. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| Velocity Financial, Inc. | ||||||
| Date: August 27, 2026 | By: | /s/ Roland T. Kelly | ||||
| Name: | Roland T. Kelly | |||||
| Title: | Chief Legal Officer and General Counsel | |||||
Exhibit 99.1
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Velocity Enters into Agreements to Acquire Toorak’s Operating Platform and Manage Toorak’s $3 Billion Business-Purpose Loan Portfolio
The acquisition materially scales Velocity’s platform and adds a capital-light, high-return, fee-based business with diversified origination channels and product suite
Westlake Village, CA – August 27, 2026 – Velocity Financial, Inc. (NYSE: VEL; “Velocity” or the “Company”) today announced a definitive agreement to acquire the operating platform of Toorak Capital LLC (“Toorak”), a business-purpose lending and asset management platform which is majority owned by funds advised by affiliates of KKR, a leading global investment firm. Toorak has also entered into separate agreements with a third-party investment firm for the purchase of Toorak’s existing portfolio of business-purpose loans (“BPL”) totaling approximately $3 billion in unpaid principal balance across whole loans and loans held in Toorak Mortgage Trust and TRK Trust securitizations.
In connection with the closing of the transactions, Velocity will also enter into an agreement with the third-party investment firm to manage the portfolio acquired from Toorak, as well as agreements to sell future Toorak loan production to the third-party investment firm and other counterparties.
The total value of the platform and portfolio transactions is estimated at approximately $3.2 billion based on Toorak’s consolidated balance sheet as of June 30, 2026.
Toorak provides real estate investors with the capital required to buy, renovate and/or rent residential properties. Since its inception in 2016, Toorak has funded over $20 billion in cumulative volume across almost 43,000 loans. Toorak’s BPL products include short-term single-family and multifamily residential transition loans (“RTL”), ground-up construction loans and long-term rental property loans (debt service coverage ratio or “DSCR” loans) secured by residential properties. Toorak has established a competitive position driven by its differentiated, AI-powered omnichannel asset sourcing and asset management platform, comprehensive product suite, industry-leading securitization program (including the first-ever rated RTL securitization), and established presence across the United States and United Kingdom markets.
The Toorak acquisition delivers compelling strategic and financial value to Velocity, including:
| • | Meaningfully enhancing the scale of its origination (+76%) and servicing (+39%) platform |
| • | Broadening and diversifying lending business by significantly expanding the RTL and DSCR products and adding a direct retail origination channel |
| • | Expanding market reach into the United Kingdom |
| • | Increasing earnings and return on equity (“ROE”) contribution from fee-based revenue streams (origination-related and servicing / asset management fees) through forward loan sale agreements to support the transition of the Toorak platform to a primarily capital-light operating model |
Velocity expects the transactions to be accretive to GAAP earnings in 2027, generate an attractive ROE, and further position the Company for sustained growth and long-term shareholder value creation.
“This acquisition reflects our commitment to scaling responsibly and deepening our presence in segments where we see durable, long-term demand,” said Chris Farrar, Co-Founder and Chief Executive Officer of Velocity. “Toorak’s exceptional team and platform are highly complementary to what we’ve built, and together we’re positioned to serve a broader set of borrowers and capital partners with greater speed and efficiency. We are thrilled to partner with the highly skilled team of professionals at Toorak.”
“When we founded Toorak in 2016, our thesis was that residential real estate investors were underserved by institutional capital. Over $20 billion in loans later, that thesis has been proven. Partnering with Velocity lets us pursue the opportunity at even greater scale,” said John Beacham, Founder and Chief Executive Officer of Toorak. “Our team will continue doing what it does best — serving our borrowers and lending partners with a consistent standard of excellence. I want to thank KKR for a decade of partnership and thank our employees, whose work made this outcome possible.”
“John and the Toorak team have built an impressive platform that has meaningfully improved financing options for the real estate mortgage market over the past decade,” said Avi Korn and Chris Mellia, Global Co-Heads of Asset-Based Finance at KKR. “We are pleased to have supported their growth through our Asset-Based Finance strategy and are confident that Velocity will be a strong partner to Toorak going forward.”
Transaction Details
The acquisition by Velocity is structured as a 100% cash purchase of Toorak’s operating platform, including Merchants Mortgage & Trust Corporation (“Merchants”), which is Toorak’s direct origination business in the United States, and Toorak’s lending operations in the United States and the United Kingdom.
Globally, Toorak has approximately 280 employees as of June 30, 2026, including approximately 120 employees of Merchants. The Company expects the acquisition to close in the fourth quarter of 2026, subject to the satisfaction of customary closing conditions.
Following the consummation of the transactions, Toorak will maintain its existing brands across its respective lending segments, including the Merchants brand, and will continue to be led by Founder and Chief Executive Officer John Beacham and the current management team and retain its corporate headquarters in Tampa, Florida. Upon closing, Mr. Beacham will become an Executive Vice President of Velocity Commercial Capital, LLC (“VCC”) and Toorak will become a subsidiary of VCC, with its operations reflected in the Company’s consolidated financial statements.
Conference Call
Velocity’s executive management team will host a conference call and webcast on August 27, 2026, at 5:30 a.m. Pacific Time / 8:30 a.m. Eastern Time to discuss the acquisition. The conference call will be webcast live and can be accessed through the Events and Presentations section of the Velocity Financial Investor Relations website: https://www.velfinance.com/events-and-presentations.
To participate by phone, please dial-in 15 minutes prior to the start time to allow for wait time to access the conference call. The live conference call will be accessible by dialing 1-646-307-1963 in the U.S. and for international callers. Callers should use the conference ID 5566224 to join the call.
Advisors
Barclays Capital Inc. served as exclusive financial advisor to Velocity and Piper Sandler & Co. served as exclusive financial advisor to Toorak and KKR. Simpson Thacher & Bartlett LLP and Morgan, Lewis & Bockius LLP served as legal counsel to Velocity and Dechert LLP served as legal counsel to Toorak and KKR.
About Velocity
Based in Westlake Village, California, Velocity is a vertically integrated real estate finance company that primarily originates and manages business-purpose loans secured by 1-4 unit residential rental and small commercial properties. Velocity originates loans nationwide across an extensive network of independent mortgage brokers built and refined over 22 years.
About Toorak
Founded in 2016 with backing from KKR, Toorak Capital LLC is a business-purpose lending and asset management platform focused on residential real estate investors across the United States and United Kingdom markets. The platform offers a range of lending solutions including RTL, ground-up construction and DSCR loan products and has funded over $20 billion of cumulative volume across almost 43,000 loans since inception.
Forward-Looking Statements
This press release contains certain “forward-looking statements” within the meaning of Section 27A of the Securities Act, as amended and Section 21E of the Exchange Act, as amended, including, but not limited to, statements that relate to the anticipated benefits of the transactions and the expected synergies from the transactions. Forward-looking statements are subject to known and unknown risks and uncertainties, many of which may be beyond Velocity Financial Inc.’s (the “Company,” “we,” “us” or “our”) control. The Company cautions that the forward-looking information contained in this press release is not a guarantee of future events, and that actual events and results may differ materially from those made in, or suggested by, the forward-looking information contained in this press release. In addition, forward-looking statements generally can be identified by the use of forward-looking terminology such as “may,” “plan,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “believe,” or “continue,” or the negative thereof, or variations thereon, or similar terminology.
A number of important factors could cause actual events and results to differ materially from those contained in or implied by the forward-looking statements, including, but not limited to: (i) the risk that the proposed transactions described in this press release may not be completed in a timely manner or at all, which may adversely affect our business; (ii) the failure to satisfy any of the conditions to the consummation of the proposed transactions, including the receipt of certain regulatory approvals; (iii) the occurrence of any event, change, or circumstance that could give rise to the termination of the proposed transactions; (iv) the effect of the announcement of the proposed transactions on the Company’s business relationships, operating results, and business generally; (v) unexpected costs, charges, or expenses resulting from the proposed transactions; and (vi) other risks described in the risk factors set forth in the Company’s filings with the SEC, including the most recent Annual Report on Form 10-K, filed with the SEC on March 12, 2026 and Quarterly Report on Form 10-Q filed with the SEC on August 6, 2026.
Any forward-looking information presented herein is made only as of the date of this press release. Except as required by applicable law, the Company does not undertake any obligation to update or revise any forward-looking information to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise.
Investors and Media:
Chris Oltmann
(818) 532-3708
Exhibit 99.2 Toorak Capital Transaction Overview August 2026
33 40 89 Forward-Looking Statements This presentation contains certain “forward-looking statements” within the meaning of Section 27A of the Securities Act, as amended and Section 21E of the Exchange Act, 240 as amended, including, but not limited to, statements that relate to the anticipated benefits of the transaction and the expected synergies from the transaction. Forward- 133 looking statements are subject to known and unknown risks and uncertainties, many of which may be beyond Velocity Financial Inc.’s (the “Company,” “we,” “us” or “our”) 33 control. The Company cautions that the forward-looking information contained in this presentation is not a guarantee of future events, and that actual events and results may differ materially from those made in, or suggested by, the forward-looking information contained in this presentation. In addition, forward-looking statements generally can be identified by the use of forward-looking terminology such as “may,” “plan,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “believe,” or “continue,” or the negative 69 thereof, or variations thereon, or similar terminology. 69 A number of important factors could cause actual events and results to differ materially from those contained in or implied by the forward-looking statements, including, but 71 not limited to: (i) the risk that the proposed transaction between the Company and Toorak Capital LLC (“Toorak”) may not be completed in a timely manner or at all, which may adversely affect our business; (ii) the failure to satisfy any of the conditions to the consummation of the proposed transaction, including the receipt of certain regulatory 102 approvals; (iii) the occurrence of any event, change, or circumstance that could give rise to the termination of the acquisition; (iv) the effect of the announcement of the proposed transaction on the Company’s business relationships, operating results, and business generally; (v) unexpected costs, charges, or expenses resulting from the 152 proposed transaction; and (vi) other risks described in the risk factors set forth in the Company’s filings with the SEC, including the most recent Annual Report on Form 10-K, 41 filed with the SEC on March 12, 2026 and Quarterly Report on Form 10-Q filed with the SEC on August 6, 2026. Any forward-looking information presented herein is made only as of the date of this presentation. Except as required by applicable law, the Company does not undertake any 84 obligation to update or revise any forward-looking information to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise. 99 This presentation also contains information showing combined 2025 figures for the Company’s and Toorak’s production volume, product offering mix, direct and third-party 193 origination mix, and duration profile. Such information does not purport to reflect what such figures would have been had the proposed transaction been completed at any historical date or to reflect production volume or other characteristics for the Company after giving effect to the proposed transaction, and should not be regarded as a prediction or forecast. 2 161 217 231 175 2 53 103 151 2
33 40 89 Transaction Overview 240 133 — Toorak is a business purpose loan origination and asset management platform with omnichannel capabilities and $20.3bn 33 (1) originations since inception — Velocity has entered into a definitive agreement to acquire the operating platform of Toorak Capital from funds advised by 69 (2) affiliates of KKR for a purchase price of $63 million 69 71 — Toorak has also entered into separate agreements with a third-party investment firm for the purchase of Toorak’s existing portfolio of business-purpose loans (“BPL”) 102 — Velocity will also enter into an agreement with the third-party investment firm to manage Toorak’s existing BPL (~$3bn across (3) Transaction 152 whole loans and securitizations), meaningfully increasing Velocity’s total assets under management to ~$10bn UPB Summary 41 — The acquisition of Toorak’s platform is anticipated to add a capital-light, high-return business with diversified origination channels and product suite, and add fee-based revenue streams (origination-related fees, servicing / asset management fees) through forward loan sale agreements 84 99 — Toorak will continue operating under its existing brands and leadership team as a subsidiary of Velocity following closing, with 193 Founder & CEO John Beacham joining Velocity as Executive Vice President — The transaction is structured as a 100% cash purchase at closing using cash from balance sheet 2 — Expected to close in the fourth quarter of 2026, subject to customary closing conditions 161 217 — Transaction diversifies Velocity’s lending business product wise, geographically and by origination channels 231 (3) 175 — Transaction is expected to meaningfully expand the scale of Velocity’s origination (+76%) and servicing (+39%) platform 2 (4) — Transaction creates a more balanced mix of short-and long-duration lending products Strategic and Financial Impacts — Expected to be accretive to GAAP earnings in 2027 and beyond 53 (4) 103 — Attractive return on equity profile 151 — Expected to earn back book value dilution (estimated to be 4-6%) in approximately three years 1. As of 7/31/2026 based on original maximum loan amount in U.S. dollars. 2. Purchase price is subject to certain customary adjustments specified in equity purchase agreement. 3. Company loan portfolio as of 6/30/2026 and Toorak loan portfolio as of 5/31/2026. Origination volumes are based on Company FY 2025 and Toorak FY 2025 data and exclude TCP U.S. production, except for the DSCR product. 3 4. Based on Toorak FY 2025 financial performance.
33 40 Toorak is a Premier Business-Purpose Loan Sourcing and 89 Asset Management Platform 240 133 (1) Toorak Overview Key Statistics 33 — Founded in 2016 with capital backing from KKR 69 <10 bps $2.9bn $20.3bn — Instrumental in the growth of the U.S. and U.K. residential 69 Cumulative Net Principal transitional loan (“RTL”) markets Lifetime Funded FY 2025 Production 71 (5) (4) Losses (2) Volume Volume — Full-service business-purpose loan product suite across RTL, 102 ground-up construction (“GUC”), and DSCR loans secured by 152 residential properties ~$3bn 41 15 Months ~280 Closing Date Loan — Substantial investments in proprietary in-house technology, Average Duration of (3) Employees (4) (6) Portfolio Managed RTL Assets analytics and overall platform infrastructure to drive scale 84 99 193 Business Segments 2 161 217 231 175 Retail channel directly sources and originates loans Acquires funded and closed loans Funds loans sourced by correspondent 2 and Broker / Table Funding channel funds loans from from correspondent partners partners at closing correspondent partners at closing 53 103 29% 34% 37% 151 (1) (1) (1) of FY 2025 Production Volume of FY 2025 Production Volume of FY 2025 Production Volume 1. As of 12/31/2025 unless otherwise noted. 2. Production based on TCP U.S. and TCP U.K. maximum loan amount. 3. Approximate total employees as of 6/30/26. 4. As of 7/31/2026. Lifetime Funded Volume based on TCP U.S. and TCP U.K. maximum loan amount. 5. Reflects cumulative net principal losses incurred across lifetime U.S. and U.K. single-family and multifamily transitional loan (RTL and GUC) activity. 4 6. Reflects approximate weighted average life of all paid-off U.S. single-family and multifamily transitional loans (RTL and GUC) held by Toorak since inception.
33 40 89 Transaction Merits 240 133 33 Significantly Increases the Scale of Velocity’s Origination Platform (1) — Meaningfully increases production volume from ~$2.7bn to ~$4.8bn+ 1 69 — Expected to enhance operating leverage from low-cost originator and market positioning 69 71 102 Broadens and Diversifies Velocity’s Product Offerings — Meaningfully expands RTL including GUC, creating a more balanced mix of short- and long-duration lending products 152 2 — Adds direct-to-consumer origination capabilities in the U.S. via Toorak’s Merchants segment 41 84 99 Expands Market Reach into the U.K. 193 — Establishes an immediate U.K. operating presence 3 — Provides relationships, expertise, and underwriting infrastructure to support scalable growth in a large, adjacent market 2 161 217 Adds Tech-Driven Underwriting and Servicing Platform — Servicing platform augments Velocity’s strong system and allows for around-the-clock capabilities 4 231 — Integrated and proprietary workflow systems (e.g., ToorakConnect / MerchantsConnect) enhance automation and data quality 175 2 Provides a Diversified, Capital-Light Revenue Platform 53 — Toorak platform is anticipated to increase contribution from recurring, fee-based revenue, complementing existing net interest margin 5 103 — Expected post-closing loan sales to forward flow partners support scalable growth without meaningful balance sheet impact 151 1. Based on Company FY 2025 and Toorak FY 2025 data (excluding TCP U.S. production except for the DSCR product). 5
33 40 89 Scales and Diversifies Velocity’s Origination Platform 240 (1) 133 The Transaction Nearly Doubles Production Volume, Diversifies Product Offerings and Expands Origination Channels 33 69 / Combined 69 71 Significant Increase in 102 $2.7bn $2.1bn $4.8bn Production 152 Volume 41 84 50% 41% 6% 3% 9% 86% 2% 29% 28% 40% 2% 1% 3% 99 Diversified Traditional Commercial Investor 1-4 Rental Short-Term Investor 1-4 Rental Investor 1-4 Rental Traditional Commercial 193 Product Single-Family GUC Multifamily Offerings Multifamily Short-Term Short-Term Multifamily Single-Family GUC 2 161 217 Direct 100% 60% 40% 83% 17% Origination 231 Capabilities Third-Party Direct Third-Party Direct Third-Party Direct 175 2 53 9% 91% Balanced 94% 6% 58% 42% 103 Duration Profile 151 Long-Term Short-Term Long-Term Short-Term Long-Term Short-Term 1. Reflects Company FY 2025 and Toorak FY 2025 data (excluding TCP U.S. production except for the DSCR product). 6
33 40 89 Adds New Channels of Origination & Proprietary Technology 240 133 Introduces Direct & Correspondent Origination Channels… …Powered by Proprietary Platform Technology 33 Toorak’s unique omnichannel asset sourcing engine will broaden the borrower Toorak’s proprietary technology and analytics platform is expected to enhance universe and position Velocity’s platform for scalable growth digital origination, improve underwriting efficiency, and further strengthen 69 credit risk management 69 71 Direct Channel Correspondent Channel AI-enabled loan aggregation and workflow platform 102 digitizing sourcing, underwriting, QA/QC, settlement 152 and document review across the loan lifecycle Toorak 41 Connect 84 Direct Retail: U.S. Correspondent: 99 • Directly sources and originates — Originations sourced and funded 193 loans in the U.S. by correspondent partners AI-enabled loan origination and CRM platform • 35+ sales professionals across — Toorak U.S. acquires closed 2 streamlines sourcing, documentation and workflows the U.S. loans 161 while automating manual processes Merchants 217 Connect Direct Broker / Table Funding: U.K. Table Funding: 231 • Borrowers and transactions — Originations sourced by 175 sourced by wholesale brokers correspondent partners 2 • Merchants directly funds the loan — Toorak U.K. directly funds the Centralized data infrastructure supporting to the borrower at transaction loan to the borrower at enterprise-wide analytics, reporting, credit 53 closing transaction closing underwriting and risk decision-making Data 103 Warehouse 151 7
33 40 89 Expands Velocity’s Geographic Footprint 240 Further U.S. Diversification… …And Strategic U.K. Expansion 133 Establishing direct origination presence in the U.S. via Merchants, which has grown Like the U.S. housing market, dynamics around aging housing stock and 33 ~2x since being acquired by Toorak in 2022 and continues to expand nationally insufficient new housing starts to support the outlook for a robust U.K. RTL market 69 Loan Production Volume by Geography (LTM December 2025) 69 71 102 152 41 84 99 193 2 161 217 231 175 2 Greater London: ~$409mm (51%) $10-50 mm >$100mm $50-100mm $0-10 mm Not Active >$100mm $50-100mm $10-50mm $0-10mm Not Active 53 103 Since launching its U.K. channel in 2017, Toorak has sourced loans through 30+ Merchants maintains a strong presence in core western states 151 correspondent partners, with a strong presence across Greater London and (AZ, CA, CO, OR, and WA) Southeast regions Note: Data as of FY 2025. 8
33 40 89 Provides a Capital-Light Platform with Attractive ROE Profile 240 Diversified Revenue Streams and Capital-Efficient Growth Support Higher Returns 133 33 69 69 Increases fee-based income to complement net interest margin – capital-light economics driven by upfront 71 fees, servicing income, and retained interest-only strip income 102 152 41 Asset management agreement on ~$3bn closing date loan portfolio meaningfully increases Velocity’s AUM 84 and delivers asset management / servicing income 99 193 2 161 Loan sales to forward flow partners following closing are expected to support origination growth / scale with 217 limited capital requirement 231 175 2 High-ROE platform anchored in high-margin RTL products, fee-driven earnings, and a capital efficient model 53 103 151 Note: Based on historic data. 9