Velocity Financial, Inc. (NYSE: VEL) has announced the pricing of $500 million in senior notes due 2031. The notes, with an aggregate principal amount of 9.375%, were priced at 100% of the principal and are set to be sold in an offering exempt from registration under the Securities Act of 1933.
The company estimates that after deducting fees and expenses, the net proceeds from the issuance and sale of the notes will be approximately $487 million. Approximately $222.7 million of the net proceeds will be used to fund the redemption of the issuer’s outstanding 7.125% senior secured notes due 2027, with the remainder allocated for general corporate purposes.
Velocity Financial, Inc., based in Westlake Village, California, primarily originates and manages business purpose loans secured by 1-4 unit residential rental and small commercial properties. The company's loans are originated nationwide across an extensive network of independent mortgage brokers established over 21 years.
The issuance and sale of the notes is expected to close on January 30, 2026, subject to customary closing conditions. The notes will bear interest at a rate of 9.375% per year, payable semi-annually in arrears on February 15 and August 15 of each year, with the first payment scheduled for August 15, 2026. The notes will accrue interest from the settlement date and are set to mature on February 15, 2031. As a result of these announcements, the company's shares have moved -0.77% on the market, and are now trading at a price of $19.45. Check out the company's full 8-K submission here.
