MFA FINANCIAL, INC. 10-K

Item 8. Financial Statements and Supplementary Data. Report of Independent Registered Public Accounting Firm To the Stockholders and Board of Directors MFA Financial, Inc.: Opinion on the Consolidated Financial Statements We have audited the accompanying consolidated balance sheets of MFA Financial, Inc. and subsidiaries (the Company) as of December 31, 2025 and 2024, the related consolidated statements of operations, comprehensive income/(loss), changes in stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2025, and the related notes and financial statement schedule IV – Mortgage Loans on Real Estate (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2025, in conformity with U.S. generally accepted accounting principles. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated February 20, 2026 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting. Basis for Opinion These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Assessment of the valuation of residential whole loans, at fair value As discussed in Notes 2, 3 and 13 to the consolidated financial statements, the Company records certain residential whole loans at fair value on its consolidated balance sheet as a result of a fair value election made at the time of acquisition. As of December 31, 2025, the recorded balance of the Company’s residential whole loans, at fair value was $7.7 billion. The Company determines the fair value of its residential whole loans held at fair value after considering valuations obtained from third-parties that specialize in providing valuations of residential mortgage loans. The valuation approach applied generally depends on whether the loan is considered performing or non-performing at the date the valuation is performed. For performing loans, estimates of fair value are derived using a discounted cash flow approach, where estimates of cash flows are determined from the scheduled payments, adjusted using forecasted prepayment, default and loss given default rates. For non-performing loans, asset liquidation cash flows are derived based on the estimated time to liquidate the loan, the estimated value of the collateral, expected costs and estimated home price levels. Estimated cash flows for both performing and non-performing loans are discounted at yields considered appropriate to arrive at a reasonable exit price for the asset. 66 Table of Contents We identified the assessment of the valuation of residential whole loans, at fair value, as a critical audit matter. A high degree of audit effort, including specialized skills and knowledge, was involved in determining certain of the estimate assumptions, including the forecasted prepayment, default and loss given default rates, property appraised value, and discount rate, which are not readily observable in the market and subject to significant measurement uncertainty. The evaluation of the methodologies and certain assumptions to determine the valuation of residential whole loans, at fair value, required subjective and complex auditor judgment as the assumptions used were sensitive to variation, such that minor changes in home prices and/or credit quality of the borrower can cause significant changes in the estimate. The following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the operating effectiveness of certain internal controls related to the Company’s measurement of residential whole loans, at fair value. This included controls related to the Company’s process to evaluate property appraised values and residential whole loan valuations. We involved valuation professionals with specialized skills and knowledge who assisted in evaluating the Company’s internal controls specific to the assessment of the third-party developed valuation techniques and models. We re-performed and assessed the Company’s comparison of fair value estimates of residential whole loans obtained from third-parties that specialize in the valuation of residential mortgage loans. We involved valuation professionals with specialized skills and knowledge, who assisted in: • evaluating that the methodologies used by the Company in determining the property appraised value and residential whole loan fair value is in accordance with U.S. GAAP • evaluating the methodology and assumptions used to determine the property appraised value used by the Company for a sample of residential whole loans at fair value • evaluating certain assumptions used to determine the residential whole loan fair value used by the Company by comparing them to market research and relevant industry practices • developing a fair value estimate for a selection of non-performing residential whole loans at fair value using the evaluated property appraised value, estimated time to liquidate the loan, expected liquidation costs, and home price index assumptions used by the Company and publicly available external market data collectively with independently developed valuation models and/or inputs and comparing the results of our estimate of fair value to the Company’s fair value estimate and • developing an independent fair value estimate for a selection of performing residential whole loans at fair value based on independently developed valuation models and/or inputs and comparing the results of our estimate of fair value to the Company’s fair value estimate. /s/ KPMG LLP We have served as the Company’s auditor since 2011. New York, New York February 20, 2026 67 Table of Contents MFA FINANCIAL, INC. CONSOLIDATED BALANCE SHEETS (In Thousands, Except Per Share Amounts) December 31, 2025 December 31, 2024 Assets: Residential whole loans, net ($ 7,717,007 and $ 7,511,210 held at fair value, respectively) (1)(2) $ 8,810,354 $ 8,811,224 Securities, at fair value (2) 3,360,280 1,537,513 Cash and cash equivalents 213,211 338,931 Restricted cash 173,457 262,381 Other assets (2) 489,147 459,555 Total Assets $ 13,046,449 $ 11,409,604 Liabilities: Financing agreements ($ 5,956,057 and $ 5,516,005 held at fair value, respectively) $ 10,940,014 $ 9,155,461 Other liabilities 278,740 412,351 Total Liabilities $ 11,218,754 $ 9,567,812 Commitments and contingencies (See Note 9) Stockholders’ Equity: Preferred stock, $ 0.01 par value; 7.5 % Series B cumulative redeemable; 12,050 and 8,050 shares authorized, respectively; 8,125 and 8,000 shares issued and outstanding, respectively ($ 203,132 and $ 200,000 aggregate liquidation preference, respectively) $ 81 $ 80 Preferred stock, $ 0.01 par value; 6.5 % Series C fixed-to-floating rate cumulative redeemable; 16,650 and 12,650 shares authorized, respectively; 11,286 and 11,000 shares issued and outstanding, respectively ($ 282,148 and $ 275,000 aggregate liquidation preference, respectively) 113 110 Common stock, $ 0.01 par value; 866,300 and 874,300 shares authorized, respectively; 101,663 and 102,083 shares issued and outstanding, respectively 1,017 1,021 Additional paid-in capital, in excess of par 3,718,350 3,711,046 Accumulated deficit ( 1,895,541 ) ( 1,879,941 ) Accumulated other comprehensive income 3,675 9,476 Total Stockholders’ Equity $ 1,827,695 $ 1,841,792 Total Liabilities and Stockholders’ Equity $ 13,046,449 $ 11,409,604 (1) Includes approximately $ 7.6 billion and $ 6.9 billion of Residential whole loans transferred to consolidated variable interest entities (“VIEs”) at December 31, 2025 and December 31, 2024, respectively. Such assets can be used only to settle the obligations of each respective VIE. (2) See Note 6 for information regarding the Company’s pledged assets. The accompanying notes are an integral part of the consolidated financial statements. 68 Table of Contents MFA FINANCIAL, INC. CONSOLIDATED STATEMENTS OF OPERATIONS For the Year Ended December 31, (In Thousands, Except Per Share Amounts) 2025 2024 2023 Interest Income: Residential whole loans $ 605,611 $ 633,556 $ 537,883 Securities, at fair value 121,258 61,110 42,376 Other interest-earning assets 1,964 7,058 9,027 Cash and cash equivalent investments 16,231 22,241 16,311 Interest Income $ 745,064 $ 723,965 $ 605,597 Interest Expense: Asset-backed and other collateralized financing arrangements $ 495,549 $ 500,026 $ 413,517 Other interest expense 18,431 21,208 15,601 Interest Expense $ 513,980 $ 521,234 $ 429,118 Net Interest Income $ 231,084 $ 202,731 $ 176,479 Reversal/(Provision) for Credit Losses on Residential Whole Loans $ ( 936 ) $ 3,084 $ 8,853 Reversal/(Provision) for Credit Losses on Other Assets — ( 1,135 ) — Net Interest Income after Reversal/(Provision) for Credit Losses $ 230,148 $ 204,680 $ 185,332 Other Income/(Loss), net: Net gain/(loss) on residential whole loans measured at fair value through earnings $ 133,689 $ 45,994 $ 89,850 Impairment and other net gain/(loss) on securities and other portfolio investments 61,543 ( 10,869 ) 6,225 Net gain/(loss) on real estate owned ( 6,760 ) 3,136 9,392 Net gain/(loss) on derivatives used for risk management purposes ( 35,544 ) 78,503 3,761 Net gain/(loss) on securitized debt measured at fair value through earnings ( 55,216 ) ( 64,813 ) ( 99,589 ) Lima One mortgage banking income 22,848 32,944 43,384 Net realized gain/(loss) on residential whole loans held at carrying value ( 882 ) 418 ( 1,240 ) Other, net ( 18,723 ) 115 11,331 Other Income/(Loss), net $ 100,955 $ 85,428 $ 63,114 Operating and Other Expense: Compensation and benefits $ 77,669 $ 87,654 $ 85,799 Other general and administrative expense 41,740 44,254 43,869 Loan servicing, financing and other related costs 33,446 35,306 34,136 Amortization of intangible assets 2,200 3,200 4,200 Operating and Other Expense $ 155,055 $ 170,414 $ 168,004 Income/(loss) before income taxes $ 176,048 $ 119,694 $ 80,442 Provision for/(benefit from) income taxes $ ( 735 ) $ 443 $ 278 Net Income/(Loss) $ 176,783 $ 119,251 $ 80,164 Less Preferred Stock Dividend Requirement $ 40,318 $ 32,875 $ 32,875 Net Income/(Loss) Available to Common Stock and Participating Securities $ 136,465 $ 86,376 $ 47,289 Basic Earnings/(Loss) per Common Share $ 1.31 $ 0.83 $ 0.46 Diluted Earnings/(Loss) per Common Share $ 1.30 $ 0.82 $ 0.46 The accompanying notes are an integral part of the consolidated financial statements. 69 Table of Contents MFA FINANCIAL, INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME/(LOSS) For the Year Ended December 31, (In Thousands) 2025 2024 2023 Net income/(loss) $ 176,783 $ 119,251 $ 80,164 Other Comprehensive Income/(Loss): Unrealized gains/(losses) on securities available-for-sale ( 5,575 ) 1,764 ( 2,873 ) Reclassification adjustment for securities sales included in net income/(loss) ( 226 ) ( 9,986 ) ( 770 ) Changes in fair value of financing agreements at fair value due to changes in instrument-specific credit risk — — — Other Comprehensive Income/(Loss) ( 5,801 ) ( 8,222 ) ( 3,643 ) Comprehensive Income/(Loss) before preferred stock dividends $ 170,982 $ 111,029 $ 76,521 Dividends required on preferred stock ( 40,318 ) ( 32,875 ) ( 32,875 ) Comprehensive Income/(Loss) Available to Common Stock and Participating Securities $ 130,664 $ 78,154 $ 43,646 The accompanying notes are an integral part of the consolidated financial statements. 70 Table of Contents MFA FINANCIAL, INC. CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (In Thousands, Except Per Share Amounts) Preferred Stock 7.5 % Series B Cumulative Redeemable - Liquidation Preference $ 25.00 per Share Preferred Stock 6.5 % Series C Fixed-to-Floating Cumulative Redeemable - Liquidation Preference $ 25.00 per Share Common Stock Additional Paid-in Capital Accumulated Deficit Accumulated Other Comprehensive Income Total Shares Amount Shares Amount Shares Amount Balance at December 31, 2024 8,000 $ 80 11,000 $ 110 102,083 $ 1,021 $ 3,711,046 $ ( 1,879,941 ) $ 9,476 $ 1,841,792 Net income/(Loss) — — — — — — — 176,783 — 176,783 Issuance of preferred stock, net of expenses 125 1 286 3 — — 9,307 — — 9,311 Issuance of common stock, net of expenses — — — — 1,100 11 ( 68 ) — — ( 57 ) Repurchase of shares of common stock (1) — — — — ( 1,520 ) ( 15 ) ( 15,303 ) — — ( 15,318 ) Equity based compensation expense — — — — — — 12,061 — — 12,061 Change in accrued dividends attributable to stock-based awards — — — — — — 1,307 ( 2,626 ) — ( 1,319 ) Dividends declared on common stock ($ 1.44 per share) — — — — — — — ( 147,305 ) — ( 147,305 ) Dividends declared on Series B Preferred Stock ($ 1.875 per share) — — — — — — — ( 15,064 ) — ( 15,064 ) Dividends declared on Series C Preferred Stock ($ 2.278731 per share) — — — — — — — ( 25,254 ) — ( 25,254 ) Dividends attributable to dividend equivalents — — — — — — — ( 2,134 ) — ( 2,134 ) Change in unrealized losses on securities, net — — — — — — — — ( 5,801 ) ( 5,801 ) Balance at December 31, 2025 8,125 $ 81 11,286 $ 113 101,663 $ 1,017 $ 3,718,350 $ ( 1,895,541 ) $ 3,675 $ 1,827,695 (In Thousands, Except Per Share Amounts) Preferred Stock 7.5 % Series B Cumulative Redeemable - Liquidation Preference $ 25.00 per Share Preferred Stock 6.5 % Series C Fixed-to-Floating Cumulative Redeemable - Liquidation Preference $ 25.00 per Share Common Stock Additional Paid-in Capital Accumulated Deficit Accumulated Other Comprehensive Income Total Shares Amount Shares Amount Shares Amount Balance at December 31, 2023 8,000 $ 80 11,000 $ 110 101,916 $ 1,019 $ 3,698,767 $ ( 1,817,759 ) $ 17,698 $ 1,899,915 Net Income/(Loss) — — — — — — — 119,251 — 119,251 Issuance of common stock, net of expenses — — — — 298 3 ( 79 ) — — ( 76 ) Repurchase of shares of common stock (1) — — — — ( 131 ) ( 1 ) ( 1,491 ) — — ( 1,492 ) Equity based compensation expense — — — — — — 13,664 — — 13,664 Change in accrued dividends attributable to stock-based awards — — — — — — 185 ( 4,437 ) — ( 4,252 ) Dividends declared on common stock ($ 1.40 per share) — — — — — — — ( 142,916 ) — ( 142,916 ) Dividends declared on Series B Preferred Stock ($ 1.875 per share) — — — — — — — ( 15,000 ) — ( 15,000 ) Dividends declared on Series C Preferred Stock ($ 1.625 per share) — — — — — — — ( 17,875 ) — ( 17,875 ) Dividends attributable to dividend equivalents — — — — — — — ( 1,205 ) — ( 1,205 ) Change in unrealized losses on securities, net — — — — — — — — ( 8,222 ) ( 8,222 ) Balance at December 31, 2024 8,000 $ 80 11,000 $ 110 102,083 $ 1,021 $ 3,711,046 $ ( 1,879,941 ) $ 9,476 $ 1,841,792 71 Table of Contents MFA FINANCIAL, INC. CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (In Thousands, Except Per Share Amounts) Preferred Stock 7.5 % Series B Cumulative Redeemable - Liquidation Preference $ 25.00 per Share Preferred Stock 6.5 % Series C Fixed-to-Floating Cumulative Redeemable - Liquidation Preference $ 25.00 per Share Common Stock Additional Paid-in Capital Accumulated Deficit Accumulated Other Comprehensive Income Total Shares Amount Shares Amount Shares Amount Balance at December 31, 2022 8,000 $ 80 11,000 $ 110 101,802 $ 1,018 $ 3,684,291 $ ( 1,717,991 ) $ 21,341 $ 1,988,849 Net Income/(Loss) — — — — — — — 80,164 — 80,164 Issuance of common stock, net of expenses — — — — 172 1 ( 7 ) — — ( 6 ) Repurchase of shares of common stock (1) — — — — ( 58 ) — ( 600 ) — — ( 600 ) Equity based compensation expense — — — — — — 14,526 — — 14,526 Change in accrued dividends attributable to stock-based awards — — — — — — 557 ( 3,933 ) — ( 3,376 ) Dividends declared on common stock ($ 1.67 per share) — — — — — — — ( 142,681 ) — ( 142,681 ) Dividends declared on Series B Preferred Stock ($ 1.875 per share) — — — — — — — ( 15,000 ) — ( 15,000 ) Dividends declared on Series C Preferred Stock ($ 1.625 per share) — — — — — — — ( 17,875 ) — ( 17,875 ) Dividends attributable to dividend equivalents — — — — — — — ( 443 ) — ( 443 ) Change in unrealized losses on securities, net — — — — — — — — ( 3,643 ) ( 3,643 ) Balance at December 31, 2023 8,000 $ 80 11,000 $ 110 101,916 $ 1,019 $ 3,698,767 $ ( 1,817,759 ) $ 17,698 $ 1,899,915 (1) For the year ended December 31, 2025, includes approximately $ 5.3 million ( 493,848 shares) surrendered for tax purposes related to equity-based compensation awards. For the year ended December 31, 2024, includes approximately $ 1.5 million ( 129,949 shares) surrendered for tax purposes related to equity-based compensation awards. For the year ended December 31, 2023, includes approximately $ 0.6 million ( 58,505 shares) surrendered for tax purposes related to equity-based compensation awards. The accompanying notes are an integral part of the consolidated financial statements. 72 Table of Contents MFA FINANCIAL, INC. CONSOLIDATED STATEMENT OF CASH FLOWS For the Year Ended December 31, (In Thousands) 2025 2024 2023 Cash Flows From Operating Activities: Net income/(loss) $ 176,783 $ 119,251 $ 80,164 Adjustments to reconcile net income/(loss) to net cash provided by/(used in) operating activities: Net (gain)/loss on residential whole loans ( 138,840 ) ( 54,227 ) ( 87,379 ) Impairment and other net (gain)/loss on securities and other portfolio investments, net ( 61,543 ) 9,190 ( 7,058 ) Net (gain)/loss on real estate owned 6,887 ( 2,729 ) ( 9,512 ) Accretion of purchase discounts and amortization of purchase premiums on residential whole loans and securities 1,228 ( 5,492 ) ( 18,968 ) Provision/(reversal of provision) for credit losses on residential whole loans and other assets 936 ( 1,949 ) ( 6,845 ) Net (gain)/loss on derivatives used for risk management purposes 65,612 ( 2,478 ) 93,828 Net (gain)/loss on securitized debt measured at fair value through earnings 42,003 51,975 86,402 Net margin received/(paid) for derivatives used for risk management purposes ( 96,068 ) 723 ( 35,643 ) Net other non-cash (gains)/losses included in net income 67,399 69,267 31,719 (Increase)/decrease in other assets 4,465 25,132 ( 80,930 ) Increase/(decrease) in other liabilities 7,383 ( 8,543 ) 62,961 Net cash provided by/(used in) operating activities $ 76,245 $ 200,120 $ 108,739 Cash Flows From Investing Activities: Purchases and origination of residential whole loans, loan related investments and capitalized advances $ ( 2,688,693 ) $ ( 2,749,400 ) $ ( 2,914,915 ) Proceeds from sales of residential whole loans 274,921 654,143 345,656 Principal payments on residential whole loans and loan related investments 2,436,939 2,202,207 1,445,759 Purchases of securities ( 2,162,706 ) ( 869,149 ) ( 588,915 ) Proceeds from sales of securities and other assets 46,813 45,619 23,294 Principal payments on securities 289,649 84,018 35,626 Proceeds from sales of real estate owned 96,429 86,145 115,026 Other investing activities ( 78,853 ) 121,820 ( 11,121 ) Net cash provided by/(used in) investing activities $ ( 1,785,501 ) $ ( 424,597 ) $ ( 1,549,590 ) Cash Flows From Financing Activities: Principal payments on financing agreements with mark-to-market collateral provisions $ ( 2,695,221 ) $ ( 2,665,761 ) $ ( 2,910,832 ) Proceeds from borrowings under financing agreements with mark-to-market collateral provisions 4,343,097 2,905,130 3,049,030 Principal payments on other collateralized financing agreements ( 1,901,450 ) ( 2,646,310 ) ( 1,997,811 ) Proceeds from borrowings under other collateralized financing agreements 1,980,927 2,984,706 3,503,400 Payments made for other collateralized financing agreement related costs ( 10,892 ) ( 7,457 ) ( 12,593 ) Redemption and repurchase of convertible senior notes — ( 209,558 ) ( 20,228 ) Proceeds from issuance of senior notes — 182,676 — Payments made for settlements and unwinds of Swaps ( 27,278 ) ( 27,530 ) — Proceeds from issuance of preferred stock, net of expenses 9,311 — — Proceeds from issuances of common stock, net of expenses ( 68 ) ( 81 ) ( 7 ) Payments made for the repurchase of common stock ( 15,313 ) ( 1,491 ) — Dividends paid on preferred stock ( 40,317 ) ( 32,875 ) ( 32,875 ) Dividends paid on common stock and dividend equivalents ( 148,184 ) ( 143,871 ) ( 143,103 ) Net cash provided by/(used in) financing activities $ 1,494,612 $ 337,578 $ 1,434,981 Net increase/(decrease) in cash, cash equivalents and restricted cash $ ( 214,644 ) $ 113,101 $ ( 5,870 ) Cash, cash equivalents and restricted cash at beginning of period $ 601,312 $ 488,211 $ 494,081 Cash, cash equivalents and restricted cash at end of period $ 386,668 $ 601,312 $ 488,211 Supplemental Disclosure of Cash Flow Information Cash paid for interest $ 508,308 $ 516,224 $ 418,135 Non-cash Investing and Financing Activities: Transfer from residential whole loans to real estate owned $ 107,105 $ 103,666 $ 84,662 Transfer from commercial loans to real estate owned $ — $ 15,217 $ 22,716 Dividends and dividend equivalents declared and unpaid $ 37,136 $ 36,039 $ 35,789 Receivable for sale of unsettled residential whole loans $ — $ — $ 14,033 Payable for unsettled investment purchases $ — $ 63,094 $ 103,654 The accompanying notes are an integral part of the consolidated financial statements. 73 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 1. Organization MFA Financial, Inc. (the “Company”) was incorporated in Maryland on July 24, 1997 and began operations on April 10, 1998. The Company has elected to be treated as a real estate investment trust (“REIT”) for U.S. federal income tax purposes. In order to maintain its qualification as a REIT, the Company must comply with a number of requirements under federal tax law, including that it must distribute at least 90% of its annual REIT taxable income to its stockholders. The Company has elected to treat certain of its subsidiaries as taxable REIT subsidiaries (“TRS”). In general, a TRS may hold assets and engage in activities that the Company cannot hold or engage in directly and generally may engage in any real estate or non-real estate related business (see Note 8). 2. Summary of Significant Accounting Policies (a) Basis of Presentation and Consolidation The accompanying consolidated financial statements of the Company have been prepared on the accrual basis of accounting in accordance with U.S. generally accepted accounting principles (“GAAP”). The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Although the Company’s estimates contemplate current conditions and how it expects them to change in the future, it is reasonably possible that actual conditions could differ from those estimates, which could materially impact the Company’s results of operations and its financial condition. Management has made significant estimates in several areas: impairment, valuation allowances and loss allowances on residential whole loans (see Note 3), certain securities designated as available-for-sale (“AFS”) (see Note 4), certain Other assets (see Note 5), valuation of Securities, at fair value (see Notes 4 and 13), income recognition and valuation of residential whole loans (see Notes 3 and 13), valuation of financing agreements (Notes 6 and 13), and valuation of derivative instruments (see Notes 5(e) and 13). In addition, estimates are used in the determination of taxable income used in the assessment of REIT compliance and contingent liabilities for related taxes, penalties and interest (see Note 8), and litigation liability (Note 9(e)). Actual results could differ from those estimates. The consolidated financial statements of the Company include the accounts of all subsidiaries. All intercompany accounts and transactions have been eliminated. In addition, the Company consolidates entities established to facilitate transactions related to the acquisition and securitization of residential whole loans. Certain prior period amounts have been reclassified to conform to the current period presentation. (b) Residential Whole Loans (including Residential Whole Loans transferred to consolidated VIEs) Residential whole loans included in the Company’s consolidated balance sheets are primarily comprised of pools of fixed- and adjustable-rate residential mortgage loans acquired through consolidated trusts in secondary market transactions or originated by our indirect wholly owned subsidiary, Lima One Capital, LLC (together with its parent company, Lima One Holdings, LLC, “Lima One”). The accounting model utilized by the Company is determined at the time each loan package is initially acquired or each loan is originated. Prior to the second quarter of 2021, the Company typically elected the fair value option on loans that were 60 or more days delinquent at purchase. All other loans purchased prior to the second quarter of 2021 were typically held at carrying value. Starting in the second quarter of 2021, the Company began to elect the fair value option for all loans originated or acquired. The accounting model initially applied to loan originations and acquisitions is not permitted to be subsequently changed. Consequently, the Company is not permitted to retroactively apply fair value accounting to loans held at carrying value acquired in periods prior to the second quarter of 2021. The Company’s residential whole loans pledged as collateral against financing agreements are included in the consolidated balance sheets with amounts pledged disclosed in Note 6. Purchases and sales of residential whole loans are recorded on the settlement date. The Company’s residential whole loans are primarily comprised of: (i) loans to finance (or refinance) one-to-four family residential properties that are not considered to meet the definition of a “Qualified Mortgage” in accordance with guidelines adopted by the Consumer Financial Protection Bureau (“Non-QM loans”), (ii) business purpose loans primarily originated by Lima One, to finance (or refinance) non-owner occupied one-to-four family residential properties that are rented to one or more tenants (“Single-family rental loans”), (iii) short-term business purpose loans primarily originated by Lima One, collateralized by residential properties made to non-occupant borrowers that generally intend to rehabilitate or construct residential housing and then refinance or sell the properties (“Single-family transitional loans”), (iv) short-term business purpose loans primarily originated by Lima One, collateralized by multifamily properties, typically with a loan balance below $ 10 million, made to non-occupant borrowers that generally intend to moderately rehabilitate or stabilize and then refinance or sell the properties (“Multifamily transitional loans”, 74 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 collectively with Single-family transitional loans, “Transitional loans”, also sometimes referred to as “Rehabilitation loans” or “Fix and Flip loans” and, collectively with Single-family rental loans, “Business purpose loans”), (v) loans primarily secured by residential real estate that were generally either non-performing or re-performing at acquisition (“Legacy RPL/NPL loans”) and (vi) loans on investor properties that conform to the standards for purchase by a federally chartered corporation, such as the Federal National Mortgage Association (“Fannie Mae”) or the Federal Home Loan Mortgage Corporation (“Freddie Mac”) (“Agency eligible investor loans”, which are included in “Other loans”). Residential whole loans are initially recorded at their purchase price (or amount funded for originated loans). Interest income is accrued based on each loan’s current interest bearing balance and current interest rate. Interest income on loans acquired at a premium/discount to par is recorded each period based on the contractual coupon net of any amortization of premium or accretion of discount, adjusted for actual prepayment activity. For loans acquired with related servicing rights retained by the seller, interest income is reported net of related servicing costs. For loans acquired prior to the second quarter of 2021 for which the fair value option was not elected, an allowance for credit losses is recorded at acquisition, and maintained on an ongoing basis, for all credit losses expected over the life of the respective loan. Any required credit loss allowance would reduce the net carrying value of the loan with a corresponding charge to earnings, and may increase or decrease over time. Judgments are required in determining any allowance for credit loss, including assumptions regarding the loan cash flows expected to be collected, the value of the underlying collateral and the ability of the Company to collect on any other forms of security, such as a personal guaranty provided either by the borrower or an affiliate of the borrower. Income recognition is suspended, and interest accruals are reversed against income, for loans at the earlier of the date on which payments become 90 days past due or when, in the opinion of management, a full recovery of income and principal becomes doubtful (i.e., such loans are placed on nonaccrual status). For nonaccrual loans, interest income is recorded when interest payments are received. Interest accruals are resumed when the loan becomes contractually current. A loan is written off when it is no longer realizable and/or it is legally discharged. Charge-offs to the allowance for loan losses occur when losses are confirmed through the receipt of cash or other consideration from the completion of a sale; when a modification or restructuring takes place in which we grant a concession to a borrower or agree to a discount in full or partial satisfaction of the loan; when we take ownership and control of the underlying collateral in full satisfaction of the loan; when loans are reclassified as other investments; or when significant collection efforts have ceased and it is highly likely that a loss has been realized. The aggregate allowance for credit losses is equal to the sum of the losses expected over the life of each respective loan. Expected losses are generally calculated based on the estimated probability of default and loss severity of loans in the portfolio, which involves projecting each loan’s expected cash flows based on their contractual terms, expected prepayments, and estimated default and loss severity rates. The expected losses in these projected cash flows are not discounted. The default and severity rates were estimated based on the following steps: (i) obtained the Company’s historical experience through an entire economic cycle for each loan type or, to the extent the Company did not have sufficient historical loss experience for a given loan type, publicly available data derived from the historical loss experience of certain banks, which data the Company believes is generally representative of its portfolio, (ii) obtained historical economic data (U.S. unemployment rates and home price appreciation) over the same period, and (iii) estimated default and severity rates during three distinct future periods based on historical default and severity rates during periods when economic conditions similar to those forecasted were experienced. The default and severity rates were applied to the estimated amount of loans outstanding during each future period, based on contractual terms and expected prepayments. Expected prepayments are estimated based on historical experience and current and expected future economic conditions, including market interest rates. The three periods were as follows: (i) a one-year forecast of economic conditions based on U.S. unemployment rates and home price appreciation, followed by (ii) a two-year “reversion” period during which economic conditions (U.S. unemployment rates and home price appreciation) are projected to revert to historical averages on a straight line basis, followed by (iii) the remaining life of each loan, during which period economic conditions (U.S. unemployment rates and home price appreciation) are projected to equal historical averages. In addition, a liability is established (and recorded in Other Liabilities) each period using a similar methodology for committed but undrawn loan amounts. The Company forecasts future economic conditions based on forecasts provided by an external preparer of economic forecasts, as well as its own knowledge of the market and its portfolio. The Company may consider multiple scenarios and select the one that it believes results in the most reasonable estimate of expected losses. The Company may apply qualitative adjustments to these results as further described in Note 3. For certain loans where foreclosure has been deemed to be probable, loss estimates are based on whether the value of the underlying collateral is sufficient to recover the carrying value of the loan. This methodology has not changed significantly from the calculation of the allowance for credit losses in prior periods, although certain modeling factors have been refined over time and the data utilized has, in some cases, been updated to better align with actual and expected loss experiences. Certain Legacy RPL/NPL loans acquired by the Company for which the Company did not elect the fair value option are accounted for as credit deteriorated as they have experienced a deterioration in credit quality since origination and prior to our 75 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 purchase and were acquired at discounted prices that reflect, in part, the impaired credit history of the borrower. Substantially all of these loans have previously experienced payment delinquencies and the amount owed may exceed the value of the property pledged as collateral. Consequently, these loans generally have a higher likelihood of default than newly originated mortgage loans with loan-to-value ratios (“LTVs”) of 80 % or less to creditworthy borrowers. The Company believes that amounts paid to acquire these loans represent fair market value at the date of acquisition. Loans considered credit deteriorated are initially recorded at their purchase price on a net basis, after establishing an initial allowance for credit losses (their initial cost basis is equal to their purchase price plus the initial allowance for credit losses). Subsequent to acquisition, the gross recorded amount for these loans reflects the initial cost basis, plus accretion/amortization of interest income, less principal and interest cash flows received. These credit deteriorated loans are presented on the Company’s consolidated balance sheets at carrying value, which reflects the recorded cost basis reduced by any allowance for credit losses. Interest income on such loans purchased is recorded each period based on the contractual coupon net of accretion/amortization of the difference between their cost basis and unpaid principal balance (“UPB”), subject to the Company’s nonaccrual policy. Loans Held-for-Sale For loans for which the fair value option was not elected, once a decision has been made to sell loans previously classified as held for investment, such loans are considered held-for-sale and are carried at the lower of cost or fair value. Residential Whole Loans at Fair Value Certain of the Company’s residential whole loans are presented at fair value on its consolidated balance sheets as a result of a fair value election made at the time of acquisition or origination. The Company generally considers accounting for these loans at fair value to be more reflective of the expected pattern of returns from these loans under current economic conditions. The Company determines the fair value of its residential whole loans held at fair value after considering portfolio valuations obtained from third-parties that specialize in providing valuations of residential mortgage loans and trading activity observed in the marketplace. Subsequent changes in fair value are reported in current period earnings and presented in Net gain/(loss) on residential whole loans measured at fair value through earnings on the Company’s consolidated statements of operations. Interest income is recorded on these loans based on their yield and is presented as part of interest income in the Company’s consolidated statements of operations. Cash outflows associated with loan-related advances made by the Company on behalf of the borrower are included in the basis of the loan and are reflected in unrealized gains or losses reported each period. Income and costs associated with originating loans on which the fair value option was elected are recorded in other income and expense, respectively, in the period in which they are earned or incurred. (c) Securities, at Fair Value Residential Mortgage Securities The Company has invested in residential mortgage-backed securities (“MBS”) that are issued or guaranteed as to principal and/or interest by a federally chartered corporation, such as Fannie Mae or Freddie Mac, or an agency of the U.S. Government, such as the Government National Mortgage Association (“Ginnie Mae”) (collectively, “Agency MBS”), and residential MBS that are not guaranteed by any agency of the U.S. Government or any federally chartered corporation (“Non-Agency MBS”). In addition, the Company has investments in credit risk transfer (“CRT”) securities that are issued by or sponsored by Fannie Mae and Freddie Mac. The coupon payments on CRT securities are paid by the issuer and the principal payments received are dependent on the performance of loans in either a reference pool or an actual pool of loans. As the loans in the underlying pool are paid, the principal balance of the CRT securities is paid. As an investor in a CRT security, the Company may incur a principal loss if the performance of the actual or reference pool loans results in either an actual or calculated loss that exceeds the credit enhancement of the security owned by the Company. Term Notes Backed by Mortgage Servicing Rights (“MSR”) Collateral The Company has invested in term notes that are issued by special purpose vehicles (“SPV”) that have acquired rights to receive cash flows representing the servicing fees and/or excess servicing spread associated with certain MSRs. The Company considers payment of principal and interest on these term notes to be largely dependent on the cash flows generated by the underlying MSRs as this impacts the cash flows available to the SPV that issued the term notes. Credit risk borne by the holders of the term notes is also mitigated by structural credit support in the form of over-collateralization. Credit support is also provided by a corporate guarantee from the ultimate parent or sponsor of the SPV that is intended to provide for payment of interest and principal 76 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 to the holders of the term notes if cash flows generated by the underlying MSRs are insufficient. During the second quarter of 2025, the term notes backed by MSR collateral were repaid in full. Designation Securities that the Company generally intends to hold until maturity, but that it may sell from time to time as part of the overall management of its business, are designated as AFS. Such securities, which include term notes backed by MSR collateral and certain CRT securities, are carried at their fair value with unrealized gains and losses excluded from earnings (except when an allowance for loan losses is recognized, as discussed below) and reported in accumulated other comprehensive income/(loss) (“AOCI”), a component of Stockholders’ Equity. Upon the sale of an AFS security, any unrealized gain or loss is reclassified out of AOCI to earnings as a realized gain or loss using the specific identification method . The Company has elected the fair value option for its Agency and Non-Agency MBS and certain of its CRT securities. These securities are carried at their fair value with changes in fair value included in earnings for the period and reported in Other Income/(Loss), net on the Company’s consolidated statements of operations. Revenue Recognition, Premium Amortization and Discount Accretion Interest income on securities is accrued based on their outstanding principal balance and their contractual terms. Premiums and discounts associated with MBS assessed as high credit quality at the time of purchase are amortized into interest income over the life of such securities using the effective yield method. Adjustments to premium amortization are made for actual prepayment activity. Premiums and discounts associated with MBS not assessed as high credit quality at the time of purchase are amortized into interest income over the life of such securities using the effective yield method based upon current expected future cash flows. Any adjustment to yield is made on a prospective basis. Determination of Fair Value for Securities In determining the fair value of the Company’s residential mortgage securities, management considers a number of observable market data points, including prices obtained from pricing services, brokers and repurchase agreement counterparties, dialogue with market participants, as well as management’s observations of market activity (see Note 13). For term notes backed by MSR collateral, other factors taken into consideration include estimated changes in fair value of the related underlying MSR collateral, as applicable, and the financial performance of the ultimate parent or sponsoring entity of the issuer, which has provided a guarantee that is intended to provide for payment of interest and principal to the holders of the term notes if cash flows generated by the related underlying MSR collateral are insufficient. Allowance for Credit Losses When the fair value of an AFS security is less than its amortized cost basis at the balance sheet date, the security is considered impaired. The Company assesses its impaired securities, as well as securities for which a credit loss allowance had been previously recorded, on at least a quarterly basis and determines whether any changes to the allowance for credit losses are required. If the Company intends to sell an impaired security, or it is more likely than not that it will be required to sell the impaired security before its anticipated recovery, then the Company must recognize a write down through charges to earnings equal to the entire difference between the investment’s amortized cost basis and its fair value at the balance sheet date. If the Company does not expect to sell an impaired security, only the portion of the impairment related to credit losses is recognized through a loss allowance charged to earnings with the remainder recognized through AOCI on the Company’s consolidated balance sheets. Impairments recognized through other comprehensive income/(loss) (“OCI”) do not impact earnings. Credit loss allowances are subject to reversal through earnings resulting from improvements in expected cash flows. The determination as to whether to record (or reverse) a credit loss allowance is subjective, as such determinations are based on factual information available at the time of assessment as well as the Company’s estimates of future performance and cash flow projections. As a result, the timing and amount of losses constitute material estimates that are susceptible to significant change (see Note 4). Balance Sheet Presentation The Company’s securities pledged as collateral against financing agreements and derivatives are included on the consolidated balance sheets with the fair value of the securities pledged disclosed in Notes 6 and 5, respectively. Purchases and sales of securities are recorded on the trade date. 77 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 (d) Cash and Cash Equivalents Cash and cash equivalents include cash on deposit with financial institutions and investments in money market funds, all of which have original maturities of three months or less. Cash and cash equivalents may also include cash pledged as collateral to the Company by its financing counterparties as a result of reverse margin calls (i.e., margin calls made by the Company). The Company did not hold any cash pledged by its counterparties at December 31, 2025 and December 31, 2024. At December 31, 2025 and December 31, 2024, the Company had cash and cash equivalents of $ 213.2 million and $ 338.9 million, respectively. At December 31, 2025 and December 31, 2024, the Company had $ 181.3 million and $ 217.8 million, respectively, of investments in overnight money market funds, which are not bank deposits and are not insured or guaranteed by the Federal Deposit Insurance Corporation (“FDIC”) or any other government agency. In addition, deposits in FDIC insured accounts generally exceed insured limits (see Notes 6 and 13). (e) Restricted Cash Restricted cash primarily represents the Company’s cash collections held in connection with certain of the Company’s financing agreements, derivative financial instruments, consolidated securitization trusts and/or loan servicing activities that are not available to the Company for general corporate purposes. Restricted cash may be applied against amounts due to financing agreements, derivative financial instrument counterparties and/or trust obligations or may be returned to the Company when the related collateral requirements are exceeded or at the maturity of financing agreements, Swaps and/or securitizations. The Company had aggregate restricted cash of $ 173.5 million and $ 262.4 million at December 31, 2025 and December 31, 2024, respectively (see Notes 5(e), 6 and 13). (f) Goodwill & Intangible Assets At December 31, 2025 and December 31, 2024, the Company had goodwill of $ 61.1 million, which represents the excess of the fair value of consideration paid over the fair value of net assets acquired in connection with the acquisition of Lima One, and other intangible assets of $ 2.6 million and $ 4.8 million, respectively (net of amortization), primarily comprised of customer relationships (fully amortized as of June 30, 2025), non-competition agreements (fully amortized as of June 30, 2022), trademarks and trade names, and internally developed software recognized as part of the acquisition of Lima One (see Note 5(b)). The intangible assets are amortized over their expected useful lives, which ranged from one to ten years at acquisition. Goodwill, which is not subject to amortization, and intangible assets are tested for impairment at least annually, or more frequently under certain circumstances that could reduce the fair value of the Lima One reporting unit (a component of the Lima One segment) below its carrying amount. Through December 31, 2025, the Company had not recognized any impairment against its goodwill or intangible assets. Goodwill and intangible assets are included in Other assets on the Company’s consolidated balance sheets. (g) Real Estate Owned (“REO”) REO represents real estate acquired by the Company, including through foreclosure, deed in lieu of foreclosure, or purchased in connection with the acquisition of residential whole loans. Generally, REO acquired through foreclosure or deed in lieu of foreclosure is initially recorded at fair value less estimated selling costs. REO acquired in connection with the acquisition of residential whole loans is initially recorded at its purchase price. Subsequent to acquisition, REO is reported, at each reporting date, at the lower of the current carrying amount or fair value less estimated selling costs and for presentation purposes is included in Other assets on the Company’s consolidated balance sheets. Changes in fair value that result in an adjustment to the reported amount of an REO property that has a fair value at or below its carrying amount are reported in Other Income/(Loss), net on the Company’s consolidated statements of operations (see Note 5). Certain multifamily REO properties and Commercial properties held within unconsolidated VIEs acquired by the Company are not immediately available for sale because we generally intend to stabilize the operations at such properties. Therefore, each property is measured at fair value at acquisition and then depreciated over the expected useful life. The amounts reported in the balance sheet at any given period represent the amortized cost basis of the property until there is a planned sale, at which point the carrying value would be updated to fair value less estimated selling costs. (h) Leases and Depreciation Leases The Company records its operating lease liabilities and operating lease right-of-use assets on its consolidated balance sheets. The operating lease liabilities are equal to the present value of the remaining fixed lease payments (excluding real estate tax and operating expense escalations) discounted at the Company’s estimated incremental borrowing rate at the date of lease 78 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 commencement, and the operating lease right-of-use assets are equal to the operating lease liabilities adjusted for lease incentives and initial direct costs. As lease payments are made, the operating lease liabilities are reduced to the present value of the remaining lease payments and the operating lease right-of-use assets are reduced by the difference between the lease expense (straight-lined over the lease term) and the theoretical interest expense amount (calculated using the incremental borrowing rate at the date of lease commencement). See Notes 5 and 9 for further discussion on leases. Leasehold Improvements, Real Estate and Other Depreciable Assets Depreciation is computed on the straight-line method over the estimated useful life of the related assets or, in the case of leasehold improvements, over the shorter of the useful life or the lease term. Furniture, fixtures, computers and related hardware have estimated useful lives ranging from five to fifteen years at the time of purchase. Multifamily REO properties have estimated useful lives of 30 years at the time of acquisition and Commercial properties held within unconsolidated VIEs have estimated useful lives of 39 years. (i) Loan Securitization and Other Debt Issuance Costs Loan securitization related costs are costs associated with the issuance of beneficial interests by consolidated VIEs and incurred by the Company in connection with various financing transactions completed by the Company. These costs may include underwriting, rating agency, legal, accounting, diligence, bank and other fees. Such costs, which reflect deferred charges (unless the debt is recorded at fair value, as discussed below), are included on the Company’s consolidated balance sheets as a direct deduction from the corresponding debt liability. These deferred charges are amortized as an adjustment to interest expense using the effective interest method. For certain financing agreements, such costs are amortized over the shorter of the period to the expected or stated legal maturity of the debt instruments. The Company periodically reviews the recoverability of these deferred costs and, in the event an impairment charge is required, such amount will be included in Operating and Other Expense on the Company’s consolidated statements of operations. To the extent that the Company has elected the fair value option for the related debt liability, these costs are expensed at the closing of the transaction. (j) Mortgage servicing rights (“MSRs”) MSRs represent the contractual right to service residential mortgage loans. The Company generally recognizes MSRs created through the sale of loans it originates. Under the accounting guidance for transfers and servicing, the Company initially measures a mortgage servicing asset that qualifies for separate recognition at fair value on the date of transfer. The Company has elected to record its investments at fair value in order to provide users of the financial statements with better information regarding the effects of prepayment risk and other market factors on MSRs. Under this election, the Company records a valuation adjustment on its MSRs on a quarterly basis to recognize the changes in fair value in net income. MSRs are aggregated into pools as applicable; each pool of MSRs is accounted for in the aggregate. Income from MSRs, other than valuation adjustments, is recorded in Lima One mortgage banking income; valuation adjustments are recorded in Impairment and other net gain/(loss) on securities and other portfolio investments. Fair value is generally determined by discounting the expected future cash flows using discount rates that incorporate the market risks and liquidity premium specific to the MSRs. (k) Financing Agreements The Company finances the majority of its residential mortgage assets with financing agreements that include securitized debt, repurchase agreements and other forms of collateralized financing. Under repurchase agreements, the Company sells assets to a lender and agrees to repurchase the same assets in the future for a price that is higher than the original sale price. The difference between the sale price that the Company receives and the repurchase price that the Company pays represents interest paid to the lender. Although legally structured as sale and repurchase transactions, the Company accounts for repurchase agreements as secured borrowings. Under its repurchase agreements and other forms of collateralized financing, the Company pledges its assets as collateral to secure the borrowing, in an amount which is equal to a specified percentage of the fair value of the pledged collateral, while the Company retains beneficial ownership of the pledged collateral. At the maturity of a repurchase financing, unless the repurchase financing is renewed with the same counterparty, the Company is required to repay the loan including any accrued interest and concurrently receives back its pledged collateral from the lender. With the consent of the lender, the Company may renew a repurchase financing at the then prevailing financing terms. Margin calls, whereby a lender requires that the Company pledge additional assets or cash as collateral to secure borrowings under its repurchase financing with such lender, are routinely experienced by the Company when the value of the assets pledged as collateral declines as a result of principal amortization and prepayments or due to changes in market interest rates, spreads or other market conditions. The Company also may make margin calls on counterparties when collateral values increase. 79 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 Should a counterparty decide not to renew a financing arrangement at maturity, the Company must either refinance elsewhere or be in a position to satisfy the obligation. If, during the term of a financing, a lender should default on its obligation, the Company might experience difficulty recovering its pledged assets which could result in an unsecured claim against the lender for the difference between the amount loaned to the Company plus interest due to the counterparty and the fair value of the collateral pledged by the Company to such lender, including accrued interest receivable on such collateral (see Notes 6 and 13). The Company has elected the fair value option on certain of its financing agreements. These agreements are reported at their fair value, with changes in fair value being recorded in earnings each period (or OCI, to the extent the change results from a change in instrument specific credit risk), as further detailed in Note 6. Interest expense on such financing agreements is recorded based on the current stated interest rate and outstanding principal balance in effect for the related agreement. (l) Equity-Based Compensation Compensation expense for equity-based awards that are subject to vesting conditions, is recognized ratably over the vesting period of such awards, based upon the fair value of such awards at the grant date. The Company has made annual grants of restricted stock units (“RSUs”) under the Company’s Equity Compensation Plan (the “Equity Plan”), certain of which cliff vest after a three-year period, subject only to continued employment, and others of which cliff vest after a three-year period, subject to both continued employment and the achievement of certain performance criteria based on a formula tied to the Company’s achievement of average total shareholder return (“TSR”) during that three-year period, as well as the TSR of the Company relative to the TSR of a group of peer companies (over the three-year period) selected by the Compensation Committee of the Company’s Board of Directors (the “Compensation Committee”) at the date of grant. The features in these awards related to the attainment of TSR over a specified period constitute a “market condition,” which impacts the amount of compensation expense recognized for these awards. Specifically, the uncertainty regarding the achievement of the market condition was reflected in the grant date fair value of the RSUs, which is recognized as compensation expense over the relevant vesting period. The amount of compensation expense recognized is not dependent on whether the market condition was or will be achieved. (m) Earnings per Common Share (“EPS”) Basic EPS is computed using the two-class method, which includes the weighted-average number of shares of common stock outstanding during the period and an estimate of other securities that participate in dividends, if any, to arrive at total common equivalent shares. In applying the two-class method, earnings are allocated to both shares of common stock and estimated securities that participate in dividends based on their respective weighted-average shares outstanding for the period. In calculating basic EPS, no adjustment is made to income available to common stockholders for forfeitable dividends or dividend equivalents. For the diluted EPS calculation, common equivalent shares are further adjusted for the effect of RSUs outstanding that are unvested and have dividends that are subject to forfeiture, using the treasury stock method. Under the treasury stock method, common equivalent shares are calculated assuming that all dilutive common stock equivalents are exercised and the proceeds, along with future compensation expenses associated with such instruments (if any), are used to repurchase shares of the Company’s outstanding common stock at the average market price during the reported period. In addition, the Company’s 6.25 % Convertible Senior Notes due 2024 (the “Convertible Senior Notes”) were included in the calculation of diluted EPS if the assumed conversion into common shares was dilutive, using the “if-converted” method until their maturity and repayment in full. This calculation involved adding back the periodic interest expense associated with the Convertible Senior Notes to the numerator and by adding the shares that would have been issued in an assumed conversion (regardless of whether the conversion option is in or out of the money) to the denominator for the purposes of calculating diluted EPS (see Note 11). (n) Comprehensive Income/(Loss) The Company’s comprehensive income/(loss) available to common stock and participating securities includes net income, the change in net unrealized gains/(losses) on its AFS securities and derivative hedging instruments (to the extent that such changes are not recorded in earnings), adjusted by realized net gains/(losses) reclassified out of AOCI for sold AFS securities and terminated hedging relationships, as well as the portion of unrealized gains/(losses) on its financing agreements held at fair value related to instrument-specific credit risk, and is reduced by dividends declared on the Company’s preferred stock and issuance costs of redeemed preferred stock. 80 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 (o) Derivative Financial Instruments The Company may use derivative instruments to economically hedge a portion of its exposure to market risks, including interest rate risk and prepayment risk. The objective of the Company’s risk management strategy is to reduce fluctuations in net book value over a range of interest rate scenarios. The Company has entered into interest rate swap agreements and ERIS swap futures (collectively, “Swaps”) that are not designated as hedges for accounting purposes. Changes in the fair value of the Company’s Swaps not designated in hedging transactions are recorded in Other Income/(Loss), net on the Company’s consolidated statements of operations. (p) Fair Value Measurements and the Fair Value Option for Financial Assets and Financial Liabilities The Company’s presentation of fair value for its financial assets and liabilities is determined within a framework that stipulates that the fair value of a financial asset or liability is an exchange price in an orderly transaction between market participants to sell the asset or transfer the liability in the market in which the reporting entity would transact for the asset or liability, that is, the principal or most advantageous market for the asset or liability. The transaction to sell the asset or transfer the liability is a hypothetical transaction at the measurement date, considered from the perspective of a market participant that holds the asset or owes the liability. This definition of fair value focuses on exit price and prioritizes the use of market-based inputs over entity-specific inputs when determining fair value. In addition, the framework for measuring fair value establishes a three-level hierarchy for fair value measurements based upon the observability of inputs to the valuation of an asset or liability as of the measurement date. In addition to the financial instruments that it is required to report at fair value, the Company has elected the fair value option for certain of its financial assets and liabilities at the time of acquisition or issuance. Subsequent changes in the fair value of these financial instruments are generally reported in Other Income/(Loss), net, in the Company’s consolidated statements of operations. A decision to elect the fair value option for an eligible financial instrument, which may be made on an instrument by instrument basis, is irrevocable (see Notes 2(b), 2(c), 3, 4, and 13). (q) Variable Interest Entities An entity is referred to as a VIE if it meets at least one of the following criteria: (i) the entity has equity that is insufficient to permit the entity to finance its activities without the additional subordinated financial support of other parties; or (ii) as a group, the holders of the equity investment at risk lack (a) the power to direct the activities of an entity that most significantly impact the entity’s economic performance; (b) the obligation to absorb the expected losses; or (c) the right to receive the expected residual returns; or (iii) the holders of the equity investment at risk have disproportional voting rights and the entity’s activities are conducted on behalf of the investor that has disproportionately few voting rights. The Company consolidates a VIE when it has both the power to direct the activities that most significantly impact the economic performance of the VIE and a right to receive benefits or absorb losses of the entity that could be potentially significant to the VIE. The Company is required to reconsider its evaluation of whether to consolidate a VIE each reporting period, based upon changes in the facts and circumstances pertaining to the VIE. The Company has entered into several financing transactions which resulted in the Company forming entities to facilitate these transactions. In determining the accounting treatment to be applied to these transactions, the Company concluded that the entities used to facilitate these transactions are VIEs and that they should be consolidated. If the Company had determined that consolidation was not required, it would have then assessed whether the transfers of the underlying assets would qualify as sales or should be accounted for as secured financings under GAAP (see Note 14). The Company also includes on its consolidated balance sheets certain financial assets and liabilities that are acquired/issued by trusts and/or other special purpose entities that have been evaluated as being required to be consolidated by the Company under the applicable accounting guidance. The Company also has investments in certain VIEs, in which it is not considered to be the primary beneficiary and which are therefore not consolidated, but the VIEs are considered equity method investments. Each of these VIEs own a commercial property upon which the Company has foreclosed, as further described in Note 5. 81 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 (r) Offering Costs Related to Issuance and Redemption of Preferred Stock Offering costs related to the issuance of preferred stock are recorded as a reduction in Additional paid-in capital, a component of Stockholders’ Equity, at the time such preferred stock is issued. On redemption of preferred stock, any excess of the fair value of the consideration transferred to the holders of the preferred stock over the carrying amount of the preferred stock in the Company’s consolidated balance sheets is included in the determination of Net Income Available to Common Stock and Participating Securities in the calculation of EPS. (s) New Accounting Standards and Interpretations As of December 31, 2025, there were no new accounting standards or interpretations adopted by the Company that had a material effect on its consolidated financial statements in 2025. In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The amendment improves income tax disclosure requirements by requiring public business entities, on an annual basis, to provide disclosure of defined categories in the income tax rate reconciliation, as well as disclosure of income taxes paid, disaggregated by jurisdiction. As of December 31, 2025, the Company has adopted ASU 2023-09 using a retrospective approach and included the required disclosures in the notes to the financial statements for income taxes. The Company has enhanced its income tax disclosures included in Note 8, Income Taxes, to comply with the requirements. The adoption did not have a material impact on the Company’s financial statements. 3. Residential Whole Loans Included on the Company’s consolidated balance sheets at December 31, 2025 and 2024 are approximately $ 8.8 billion and $ 8.8 billion, respectively, of residential whole loans generally arising from the Company’s interests in certain trusts established to acquire the loans and certain entities established in connection with its loan securitization transactions. The Company has assessed that these entities are required to be consolidated for financial reporting purposes. Starting in the second quarter of 2021, the Company elected the fair value option for all loan acquisitions, including loans originated by Lima One subsequent to its acquisition by the Company. Prior to the second quarter of 2021, the fair value option was typically elected only for loans that were 60 or more days delinquent at purchase. The following table presents the components of the Company’s Residential whole loans, and the accounting model designated at December 31, 2025 and 2024: Held at Carrying Value Held at Fair Value Total (Dollars in Thousands) December 31, 2025 December 31, 2024 December 31, 2025 December 31, 2024 December 31, 2025 December 31, 2024 Non-QM loans $ 593,213 $ 722,392 $ 4,753,480 $ 3,568,694 $ 5,346,693 $ 4,291,086 Business purpose loans: Single-family rental loans (1) $ 88,112 $ 108,203 $ 1,147,234 $ 1,248,197 $ 1,235,346 $ 1,356,400 Single-family transitional loans (2) (3) 7,051 22,430 711,294 1,078,425 718,345 1,100,855 Multifamily transitional loans — — 489,637 938,926 489,637 938,926 Total Business purpose loans $ 95,163 $ 130,633 $ 2,348,165 $ 3,265,548 $ 2,443,328 $ 3,396,181 Legacy RPL/NPL loans 414,676 457,654 564,340 624,895 979,016 1,082,549 Other loans — — 51,022 52,073 51,022 52,073 Allowance for Credit Losses ( 9,705 ) ( 10,665 ) — — ( 9,705 ) ( 10,665 ) Total Residential whole loans $ 1,093,347 $ 1,300,014 $ 7,717,007 $ 7,511,210 $ 8,810,354 $ 8,811,224 Number of loans 4,941 5,582 18,824 18,588 23,765 24,170 (1) No loans were held for sale as of December 31, 2025 and December 31, 2024. There were no gains/(losses) on held-for-sale loans for the year ended December 31, 2025. For the year ended December 31, 2024, the Company recorded a $ 0.5 million gain on these loans resulting from their sale, which were held-for-sale as of December 31, 2023. (2) Includes $ 300.2 million and $ 442.4 million of loans collateralized by new construction projects at origination as of December 31, 2025 and December 31, 2024, respectively. (3) No loans were held-for-sale as of December 31, 2025 and December 31, 2024. For the three months ended March 31, 2025, the Company recorded a $ 0.5 million loss on these loans resulting from the adjustment of their carrying value to the lower of cost or market. For the three months ended June 30, 2025, the Company recorded a $ 0.3 million loss on these loans resulting from their sale. There were no gains/(losses) on held-for-sale loans for the three months ended September 30, 2025. There were no gains/(losses) on held-for-sale loans for the three months ended December 31, 2025. There were no gains/(losses) on held-for-sale loans for the twelve months ended December 31, 2024. 82 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 The following tables present additional information regarding the Company’s Residential whole loans: December 31, 2025 Asset Amount Fair Value Unpaid Principal Balance (“UPB”) Weighted Average Coupon (1) (2) Weighted Average Term to Maturity (Months) Weighted Average LTV Ratio (3) Weighted Average Original FICO (4) Aging by UPB 60+ Days Past Due % Past Due Days (Dollars In Thousands) Current 30-59 60-89 90+ Non-QM loans $ 5,344,968 $ 5,332,533 $ 5,322,321 6.74 % 337 64 % 738 $ 4,929,485 $ 170,509 $ 47,154 $ 175,173 4.2 % Business purpose loans: Single-family rental $ 1,234,428 $ 1,237,464 $ 1,246,745 6.34 % 311 66 % 740 $ 1,193,041 $ 22,309 $ 4,165 $ 27,230 2.5 % Single-family transitional (5) 717,303 717,702 732,059 10.31 % 6 69 % 750 599,798 48,180 2,535 81,546 11.5 % Multifamily transitional (5) 489,637 489,637 531,804 10.17 % 1 64 % 749 399,686 44,523 32,905 54,690 16.5 % Total business purpose loans $ 2,441,368 $ 2,444,803 $ 2,510,608 8.31 % 66 % $ 2,192,525 $ 115,012 $ 39,605 $ 163,466 8.1 % Legacy RPL/NPL loans 972,996 992,120 1,097,698 5.09 % 245 54 % 646 757,826 125,621 47,620 166,631 19.5 % Other loans 51,022 51,022 59,283 3.43 % 308 63 % 757 59,283 — — — — % Residential whole loans, total or weighted average $ 8,810,354 $ 8,820,478 $ 8,989,910 6.98 % 64 % $ 7,939,119 $ 411,142 $ 134,379 $ 505,270 7.1 % December 31, 2024 Asset Amount Fair Value Unpaid Principal Balance (“UPB”) Weighted Average Coupon (1) (2) Weighted Average Term to Maturity (Months) Weighted Average LTV Ratio (3) Weighted Average Original FICO (4) Aging by UPB 60+ Days Past Due % Past Due Days (Dollars In Thousands) Current 30-59 60-89 90+ Non-QM loans $ 4,288,961 $ 4,258,298 $ 4,408,660 6.50 % 339 64 % 735 $ 4,114,436 $ 124,765 $ 50,619 $ 118,840 3.8 % Business purpose loans: Single-family rental $ 1,356,034 $ 1,355,965 $ 1,416,705 6.36 % 321 68 % 739 $ 1,346,312 $ 15,661 $ 5,445 $ 49,287 3.9 % Single-family transitional (5) 1,099,466 1,099,700 1,106,631 10.44 % 5 67 % 750 957,266 33,393 15,964 100,008 10.5 % Multifamily transitional (5) 938,926 938,926 976,964 9.17 % 6 64 % 751 870,525 20,815 — 85,624 8.8 % Total Business purpose loans $ 3,394,426 $ 3,394,591 $ 3,500,300 8.43 % 67 % $ 3,174,103 $ 69,869 $ 21,409 $ 234,919 7.3 % Legacy RPL/NPL loans 1,075,764 1,090,991 1,222,258 5.15 % 253 55 % 647 831,844 129,081 45,074 216,259 21.4 % Other loans 52,073 52,073 63,614 3.44 % 320 65 % 758 62,998 616 — — — % Residential whole loans, total or weighted average $ 8,811,224 $ 8,795,953 $ 9,194,832 7.06 % 64 % $ 8,183,381 $ 324,331 $ 117,102 $ 570,018 7.5 % (1) Weighted average is calculated based on the interest bearing principal balance of each loan within the related category. For loans acquired with servicing rights released by the seller, interest rates included in the calculation do not reflect loan servicing fees. For loans acquired with servicing rights retained by the seller, interest rates included in the calculation are net of servicing fees. Certain Transitional Loans contain contractual features which increase the loan’s interest rate following an event of default. The weighted average coupon presented is calculated based on each loan’s coupon rate without regard to post-default rate adjustments. (2) For the quarter ended December 31, 2025, the gross coupon was 6.88 % for Non-QM loans, 6.37 % for Single-family rental loans, 10.32 % for Single-family transitional loans, 10.18 % for Multifamily transitional loans, and 5.10 % for Legacy RPL/NPL loans. For the quarter ended December 31, 2024, the gross coupon was 6.65 % for Non-QM loans, 6.39 % for Single-family rental loans, 10.45 % for Single-family transitional loans, 9.18 % for Multifamily transitional loans, and 5.16 % for Legacy RPL/NPL loans. (3) LTV represents the ratio of the total unpaid principal balance of the loan to the estimated value of the collateral securing the related loan as of the most recent date available, which may be the origination date. Excluded from the calculation of weighted average are certain low value loans secured by vacant lots, for which the LTV ratio is not meaningful. (4) Excludes loans for which no Fair Isaac Corporation (“FICO”) score is available. (5) For Single-family and Multifamily transitional loans, the LTV presented is the ratio of the maximum unpaid principal balance of the loan, including unfunded commitments, to the estimated “after repaired” value of the collateral securing the related loan, where available. For certain Single-family transitional loans, totaling $ 270.9 million and $ 445.6 million at December 31, 2025 and December 31, 2024, respectively, and certain Multifamily transitional loans, totaling $ 121.1 million and $ 252.1 million at December 31, 2025 and December 31, 2024, respectively, an after repaired valuation was not available. For these loans, the weighted average LTV is calculated based on the current unpaid principal balance and the as-is value of the collateral securing the related loan. 83 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 Sales of Residential Whole Loans During 2025, Residential whole loans with an unpaid principal balance of $ 274.5 million were sold, realizing losses, before the impact of economic hedging and the reversal of previously recognized unrealized losses, of $ 14.0 million. Upon sale, the Company reversed $ 8.2 million of previously recognized unrealized losses, resulting in a net loss on sale of $ 5.8 million during the year. During 2024, Non-QM loans with an unpaid principal balance of $ 692.8 million were sold, realizing losses, before the impact of economic hedging gains and the reversal of previously recognized unrealized losses, of $ 42.0 million. Upon sale, the Company reversed $ 47.1 million of previously recognized unrealized losses, resulting in a net gain on sale of $ 5.1 million. Allowance for Credit Losses The following table presents a roll-forward of the allowance for credit losses on the Company’s Residential whole loans, at carrying value: For the Year Ended December 31, 2025 (In Thousands) Non-QM loans Single-family rental loans Single-family transitional loans (1) Legacy RPL/NPL loans (2) Totals Allowance for credit losses at December 31, 2024 $ 2,125 $ 366 $ 1,389 $ 6,785 $ 10,665 Current provision/(reversal) ( 197 ) 614 ( 88 ) ( 184 ) 145 Write-offs — — ( 436 ) ( 180 ) ( 616 ) Allowance for credit losses at March 31, 2025 $ 1,928 $ 980 $ 865 $ 6,421 $ 10,194 Current provision/(reversal) 87 ( 43 ) 669 78 791 Write-offs — — ( 1,022 ) ( 14 ) ( 1,036 ) Allowance for credit losses at June 30, 2025 $ 2,015 $ 937 $ 512 $ 6,485 $ 9,949 Current provision/(reversal) 205 ( 78 ) 548 ( 399 ) 276 Write-offs ( 38 ) ( 30 ) — ( 74 ) ( 142 ) Allowance for credit losses at September 30, 2025 $ 2,182 $ 829 $ 1,060 $ 6,012 $ 10,083 Current provision/(reversal) ( 457 ) 90 ( 18 ) 109 ( 276 ) Write-offs — ( 1 ) — ( 101 ) ( 102 ) Allowance for credit losses at December 31, 2025 $ 1,725 $ 918 $ 1,042 $ 6,020 $ 9,705 Year Ended December 31, 2024 (Dollars In Thousands) Non-QM loans Single-family rental loans Single-family transitional loans (1) Legacy RPL/NPL loans (2) Totals Allowance for credit losses at December 31, 2023 $ 1,871 $ 4,355 $ 2,587 $ 11,638 $ 20,451 Current provision/(reversal) ( 190 ) 228 ( 472 ) ( 26 ) ( 460 ) Write-offs — 59 ( 416 ) ( 22 ) ( 379 ) Allowance for credit losses at March 31, 2024 $ 1,681 $ 4,642 $ 1,699 $ 11,590 $ 19,612 Current provision/(reversal) ( 326 ) 978 ( 317 ) ( 1,414 ) ( 1,079 ) Write-offs — ( 5,011 ) ( 81 ) ( 170 ) ( 5,262 ) Allowance for credit losses at June 30, 2024 $ 1,355 $ 609 $ 1,301 $ 10,006 $ 13,271 Current provision/(reversal) 387 205 48 ( 2,582 ) ( 1,942 ) Write-offs — ( 439 ) ( 181 ) ( 52 ) ( 672 ) Allowance for credit losses at September 30, 2024 $ 1,742 $ 375 $ 1,168 $ 7,372 $ 10,657 Current provision/(reversal) 383 184 379 ( 548 ) 398 Write-offs — ( 193 ) ( 158 ) ( 39 ) ( 390 ) Allowance for credit losses at December 31, 2024 $ 2,125 $ 366 $ 1,389 $ 6,785 $ 10,665 (1) Includes $ 3.8 million and $ 14.7 million of loans that were assessed for credit losses based on a collateral dependent methodology as of December 31, 2025 and 2024, respectively. (2) Includes $ 28.4 million and $ 34.2 million of loans that were assessed for credit losses based on a collateral dependent methodology as of December 31, 2025 and 2024, respectively. Estimates of credit losses under credit losses on financial instruments (“ CECL”) are highly sensitive to changes in assumptions, and current economic conditions have increased the difficulty of accurately forecasting future conditions. 84 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 The carrying value of Residential whole loans on nonaccrual status as of December 31, 2025 and December 31, 2024 was $ 579.9 million and $ 638.3 million, respectively. During the year ended December 31, 2025, the Company recognized $ 12.3 million of interest income on loans on nonaccrual status, including $ 7.2 million on its portfolio of loans which were non-performing at acquisition. At December 31, 2025 and December 31, 2024, there were approximately $ 25.7 million and $ 38.7 million, respectively, of loans held at carrying value on nonaccrual status that did not have an associated allowance for credit losses because they were determined to be collateral dependent and the estimated fair value of the related collateral exceeded the carrying value of each loan, respectively. During the year ended December 31, 2025, the Company granted six loan modifications in its carrying value loan portfolio which gave borrowers term extensions, with one of them including an interest rate reduction. The average increase in weighted average life was 58 months, and the interest rate reduction was 1.25 %. As of December 31, 2025, the carrying value of these loans was approximately $ 0.55 million. As of December 31, 2025, two of these modifications were delinquent for more than 120 days. During the years ended December 31, 2024 and 2023, the Company granted three and four loan modifications in its carrying value loan portfolio, respectively, which gave borrowers term extensions. The following table presents certain additional credit-related information regarding our Residential whole loans, at carrying value: Amortized Cost Basis by Origination Year and LTV Bands (Dollars In Thousands) 2025 - 2022 2021 Prior Total Non-QM loans LTV <= 80% (1) $ — $ 35,782 $ 550,530 $ 586,312 LTV > 80% (1) — — 6,901 6,901 Total Non-QM loans $ — $ 35,782 $ 557,431 $ 593,213 Twelve Months Ended December 31, 2025 Gross write-offs $ — $ — $ 38 $ 38 Business purpose loans LTV <= 80% (1) $ — $ 5,684 $ 87,330 $ 93,014 LTV > 80% (1) — — 2,149 2,149 Total Business purpose loans $ — $ 5,684 $ 89,479 $ 95,163 Twelve Months Ended December 31, 2025 Gross write-offs $ — $ 31 $ 1,458 $ 1,489 Legacy RPL/NPL loans LTV <= 80% (1) $ — $ — $ 370,606 $ 370,606 LTV > 80% (1) — — 44,070 44,070 Total Legacy RPL/NPL loans $ — $ — $ 414,676 $ 414,676 Twelve Months Ended December 31, 2025 Gross write-offs $ — $ — $ 369 $ 369 Total LTV <= 80% (1) $ — $ 41,466 $ 1,008,467 $ 1,049,932 Total LTV > 80% (1) — — 53,119 53,120 Total Residential whole loans, at carrying value $ — $ 41,466 $ 1,061,586 $ 1,103,052 Twelve Months Ended December 31, 2025 Total Gross write-offs $ — $ 31 $ 1,865 $ 1,896 (1) LTV represents the ratio of the total unpaid principal balance of the loan to the estimated value of the collateral securing the related loan as of the most recent date available, which may be the origination date. For Single-family and Multifamily transitional loans, the LTV presented is the ratio of the maximum unpaid principal balance of the loan, including unfunded commitments, to the estimated “after repaired” value of the collateral securing the related loan, where available. For certain Single-family transitional loans, an after repaired valuation was not obtained and the loan was underwritten based on an “as is” valuation. Excluded from the calculation of weighted average LTV are certain low value loans secured by vacant lots, for which the LTV is not meaningful. The following table presents vintage information regarding our Residential whole loans, at fair value: Fair Value by Origination Year (In Thousands) 2025 2024 2023 2022 2021 Prior Total Non-QM loans $ 1,636,561 $ 935,187 $ 536,892 $ 522,677 $ 1,093,462 $ 28,701 $ 4,753,480 Single-family rental loans 68,443 39,714 214,193 489,218 329,194 6,472 1,147,234 Single-family transitional loans 363,991 208,235 112,698 22,185 4,185 — 711,294 Multifamily transitional loans — 62,635 198,847 151,417 76,738 — 489,637 Legacy RPL/NPL loans — — — — — 564,340 564,340 Other loans — — — — 51,022 — 51,022 Total Residential whole loans, at fair value $ 2,068,995 $ 1,245,771 $ 1,062,630 $ 1,185,497 $ 1,554,601 $ 599,513 $ 7,717,007 85 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 The following table presents realized credit losses, net of recoveries, on liquidated residential whole loans or residential whole loans that were transferred to REO, recognized in Other, net: For the Year Ended December 31, (In Thousands) 2025 2024 2023 Non-QM loans $ ( 1,156 ) $ ( 65 ) $ 962 Single-family rental loans ( 12,454 ) ( 2,347 ) 214 Single-family transitional loans ( 5,405 ) ( 2,775 ) 462 Multifamily transitional loans ( 6,724 ) ( 5,465 ) 46 Legacy RPL/NPL loans ( 858 ) ( 858 ) ( 2,491 ) Other loans — — — Total Residential whole loans $ ( 26,597 ) $ ( 11,510 ) $ ( 807 ) The following tables present certain information regarding the LTVs of the Company’s Residential whole loans that are 60 days or more delinquent: December 31, 2025 (Dollars In Thousands) Carrying Value / Fair Value UPB LTV (1) Non-QM loans $ 218,793 $ 222,327 64 % Business purpose loans: Single-family rental loans $ 29,967 $ 31,395 68 % Single-family transitional loans 70,821 84,081 83 % Multifamily transitional loans 54,884 87,595 68 % Total Business purpose loans $ 155,672 $ 203,071 Legacy RPL/NPL loans 197,511 214,251 60 % Other loans — — — % Total Residential whole loans $ 571,976 $ 639,649 December 31, 2024 (Dollars In Thousands) Carrying Value / Fair Value UPB LTV (1) Non-QM loans $ 166,299 $ 169,459 66 % Business purpose loans: Single-family rental loans $ 42,995 $ 54,732 99 % Single-family transitional loans 109,221 115,972 79 % Multifamily transitional loans 56,970 85,624 79 % Total Business purpose loans $ 209,186 $ 256,328 Legacy RPL/NPL loans 240,356 261,333 63 % Other loans — — — % Total Residential whole loans $ 615,841 $ 687,120 (1) LTV represents the ratio of the total unpaid principal balance of the loan to the estimated value of the collateral securing the related loan as of the most recent date available, which may be the origination date. For Single-family and Multifamily transitional loans, the LTV presented is the ratio of the maximum unpaid principal balance of the loan, including unfunded commitments, to the estimated “after repaired” value of the collateral securing the related loan, where available. For certain Single-family transitional loans, an after repaired valuation was not obtained and the loan was underwritten based on an “as is” valuation. Excluded from the calculation of weighted average LTV are certain low value loans secured by vacant lots, for which the LTV ratio is not meaningful. 86 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 The following tables present the components of interest income on the Company’s Residential whole loans: Held at Carrying Value Held at Fair Value Total For the Year Ended December 31, For the Year Ended December 31, For the Year Ended December 31, (In Thousands) 2025 2024 2023 2025 2024 2023 2025 2024 2023 Non-QM loans 37,074 43,227 47,471 255,159 192,735 145,856 292,233 235,962 193,327 Business purpose loans: Single-family rental loans $ 6,914 $ 8,864 $ 11,167 $ 78,476 $ 95,258 $ 82,974 $ 85,390 $ 104,122 $ 94,141 Single-family transitional loans 4,129 1,230 1,346 81,805 112,249 82,377 85,934 113,479 83,723 Multifamily transitional loans — — — 64,741 94,443 65,706 64,741 94,443 65,706 Total Business purpose loans $ 11,043 $ 10,094 $ 12,513 $ 225,022 $ 301,950 $ 231,057 $ 236,065 $ 312,044 $ 243,570 Legacy RPL/NPL loans 28,210 31,241 34,150 47,264 52,298 62,464 75,474 83,539 96,614 Other loans — — — 1,839 2,011 4,372 1,839 2,011 4,372 Total Residential whole loans $ 76,327 $ 84,562 $ 94,134 $ 529,284 $ 548,994 $ 443,749 $ 605,611 $ 633,556 $ 537,883 The following table presents the components of Net gain/(loss) on residential whole loans measured at fair value through earnings : For the Year Ended December 31, (In Thousands) 2025 2024 2023 Non-QM loans $ 119,716 $ 65,717 $ 56,871 Business purpose loans: Single-family rental loans $ 50,136 $ 29,359 $ 17,117 Single-family transitional loans ( 19,033 ) ( 2,031 ) 468 Multifamily transitional loans ( 19,569 ) ( 35,890 ) 5,807 Total Business purpose loans $ 11,534 $ ( 8,562 ) $ 23,392 Legacy RPL/NPL loans ( 1,031 ) ( 10,830 ) 7,841 Other loans 3,470 ( 331 ) 1,746 Total Residential whole loans $ 133,689 $ 45,994 $ 89,850 87 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 4. Securities, at Fair Value Agency MBS Agency MBS are guaranteed as to principal and/or interest by a federally chartered corporation, such as Fannie Mae or Freddie Mac, or an agency of the U.S. Government, such as Ginnie Mae. The following table presents certain information regarding the composition of our Agency MBS portfolio : December 31, 2025 (Dollars in Thousands) Current Face Weighted Average Purchase Price Weighted Average Market Price Fair Value Weighted Average Loan Age (Months) CPR (1) 30-Year Fixed Rate: 5.00 % Coupon $ 859,115 99.5 % 100.1 % $ 860,163 5 4.1 % 5.50 % Coupon 2,123,143 100.2 % 101.7 % 2,159,949 12 15.0 % 6.00 % Coupon 269,129 100.1 % 103.1 % 277,489 26 18.1 % 6.50 % Coupon 5,373 101.0 % 104.3 % 5,603 25 8.2 % Total $ 3,256,760 100.0 % 101.4 % $ 3,303,204 11 12.9 % December 31, 2024 (Dollars in Thousands) Current Face Weighted Average Purchase Price Weighted Average Market Price Fair Value Weighted Average Loan Age (Months) CPR (1) 30-Year Fixed Rate: 5.00 % Coupon $ 71,645 100.2 % 96.6 % $ 69,233 21 3.3 % 5.50 % Coupon 993,466 100.2 % 98.8 % 981,796 9 8.2 % 6.00 % Coupon 313,173 100.1 % 100.7 % 315,317 14 11.5 % 6.50 % Coupon 25,607 100.4 % 102.7 % 26,289 15 36.1 % Total $ 1,403,891 100.2 % 99.2 % $ 1,392,635 11 9.2 % (1) Reflects the average of the one month CPR for the number of months the security was held during the most recent three month period. Term Notes Backed by MSR Collateral During the second quarter of 2025, the Term Notes Backed by MSR Collateral were repaid in full. At December 31, 2024, the Company had $ 54.6 million of term notes issued by SPVs that had acquired rights to receive cash flows representing the servicing fees and/or excess servicing spread associated with certain MSRs. Payment of principal and interest on these term notes was considered to be largely dependent on cash flows generated by the underlying MSRs, as this impacts the cash flows available to the SPV that issued the term notes. CRT Securities CRT securities are debt obligations issued by or sponsored by Fannie Mae and Freddie Mac. The coupon payments on CRT securities are paid by the issuer and the principal payments received are dependent on the performance of loans in either a reference pool or an actual pool of loans. At December 31, 2025 and December 31, 2024, the Company had $ 34.9 million and $ 67.6 million, respectively, of CRT securities. As an investor in a CRT security, the Company may incur a principal loss if the performance of the actual or reference pool loans results in either an actual or calculated loss that exceeds the credit enhancement of the security owned by the Company. The Company assesses the credit risk associated with its investments in CRT securities by assessing the current and expected future performance of the associated loan pool. The Company pledges a portion of its CRT securities as collateral against its borrowings under repurchase agreements (see Note 6). Non-Agency MBS Non-Agency MBS are primarily secured by pools of residential mortgages, which are not guaranteed by an agency of the U.S. Government or any federally chartered corporation. At December 31, 2025, and December 31, 2024, the Company had $ 22.1 million and $ 22.6 million, respectively, of Non-Agency MBS. These securities were acquired on the de-consolidation of certain trusts that held previously securitized Agency Eligible investor loans. 88 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 The following tables present certain information about the Company’s Agency MBS and other Securities: December 31, 2025 (In Thousands) Principal/Current Face Purchase Premiums Accretable Purchase Discounts Discount Designated as Credit Reserve (1) Gross Amortized Cost Basis Gross Unrealized Gains Gross Unrealized Losses Net Unrealized Gain/(Loss) Fair Value Agency MBS $ 3,256,760 $ 13,996 $ ( 13,070 ) $ — $ 3,257,686 $ 45,539 $ ( 21 ) $ 45,518 $ 3,303,204 Other Securities (2)(3)(4) 59,919 4,009 ( 4,657 ) ( 7,191 ) 52,080 5,231 ( 235 ) 4,996 57,076 Total residential mortgage securities (2)(3)(4) $ 3,316,679 $ 18,005 $ ( 17,727 ) $ ( 7,191 ) $ 3,309,766 $ 50,770 $ ( 256 ) $ 50,514 $ 3,360,280 December 31, 2024 (In Thousands) Principal/Current Face Purchase Premiums Accretable Purchase Discounts Discount Designated as Credit Reserve (1) Gross Amortized Cost Basis Gross Unrealized Gains Gross Unrealized Losses Net Unrealized Gain/(Loss) Fair Value Agency MBS $ 1,403,891 $ 5,534 $ ( 3,525 ) $ — $ 1,405,900 $ 2,318 $ ( 15,583 ) $ ( 13,265 ) $ 1,392,635 Other Securities (2)(3)(4) 146,808 14,747 ( 5,662 ) ( 23,691 ) 132,202 13,166 ( 490 ) 12,676 144,878 Total residential mortgage securities (2)(3)(4) $ 1,550,699 $ 20,281 $ ( 9,187 ) $ ( 23,691 ) $ 1,538,102 $ 15,484 $ ( 16,073 ) $ ( 589 ) $ 1,537,513 (1) Discount designated as Credit Reserve is generally not expected to be accreted into interest income. (2) Based on management ’ s current estimates of future principal cash flows expected to be received. (3) Amounts disclosed at December 31, 2025 include CRT securities with a fair value of $ 21.7 million for which the fair value option has been elected. Such securities had approximately $ 0.9 million gross unrealized gains and no gross unrealized losses at December 31, 2025. Amounts disclosed at December 31, 2024 include CRT securities with a fair value of $ 51.5 million for which the fair value option has been elected. Such securities had gross unrealized gains of approximately $ 3.2 million and no gross unrealized losses at December 31, 2024. (4) Amounts disclosed at December 31, 2025 include Non-Agency MBS with a fair value of $ 22.1 million for which the fair value option has been elected. Such securities had approximately $ 0.6 million gross unrealized gains and $ 0.2 million gross unrealized losses at December 31, 2025. Amounts disclosed at December 31, 2024 include Non-Agency MBS with a fair value of $ 22.6 million for which the fair value option has been elected. Such securities had $ 0.5 million gross unrealized gains and $ 0.5 million gross unrealized losses at December 31, 2024. Sales of Residential Mortgage Securities During the year ended December 31, 2025, the Company sold an agency bond for approximately $ 18.2 million, realizing a gain of $ 0.7 million. During the year ended December 31, 2025, the Company sold CRT securities for approximately $ 28.6 million, realizing gains of $ 1.6 million. During the year ended December 31, 2024, the Company sold a CRT security for approximately $ 16.0 million, realizing gains of $ 7.3 million. During the year ended December 31, 2024, the Company sold MSR securities for approximately $ 29.6 million, realizing gains of $ 2.7 million. During the year ended December 31, 2023, the Company sold MSR securities for approximately $ 18.2 million, realizing gains of $ 908,000 . Impairment and Other Net Gain/(Loss) on Securities and Other Portfolio Investment s The following table presents the components of Impairment and other net gain/(loss) on securities and other portfolio investments, which is presented in Other Income/(Loss), net in the consolidated statements of operations: For the Year Ended December 31, (In Thousands) 2025 2024 2023 Net unrealized gain/(loss) on securities $ 56,904 $ ( 16,194 ) $ 7,341 Net realized gain/(loss) from the sale of securities 2,301 9,992 908 Impairment of securities — — — Total Impairment and other net gain/(loss) on securities $ 59,205 $ ( 6,202 ) $ 8,249 Net unrealized gain/(loss) on other portfolio investments 2,316 ( 4,761 ) 6,180 Net realized gain/(loss) on other portfolio investments 22 94 ( 5,869 ) Reversal of impairment/(impairment) other portfolio investments — — ( 2,335 ) Total Impairment and other net gain/(loss) on securities and other portfolio investments $ 61,543 $ ( 10,869 ) $ 6,225 89 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 Unrealized Losses on Residential Mortgage Securities There were no gross unrealized losses on the Company’s AFS securities (whose changes in fair value are recorded through OCI) at December 31, 2025. There were no allowances for credit losses recorded with respect to the Company’s AFS securities for any of the periods presented. The Company did not recognize an allowance for credit losses through earnings related to its AFS securities for the years ended December 31, 2025, 2024 and 2023. Impact of AFS Securities on AOCI The following table presents the impact of the Company’s AFS securities (whose changes in fair value are recorded through OCI) on its AOCI: For the Year Ended December 31, (In Thousands) 2025 2024 2023 AOCI from AFS securities: Unrealized gain on AFS securities at beginning of period $ 9,476 $ 17,698 $ 21,341 Unrealized gain/(loss) on securities available-for-sale ( 5,575 ) 1,764 ( 2,873 ) Reclassification adjustment for MBS sales included in net income ( 226 ) ( 9,986 ) ( 770 ) Change in AOCI from AFS securities ( 5,801 ) ( 8,222 ) ( 3,643 ) Balance at end of period $ 3,675 $ 9,476 $ 17,698 Interest Income on Securities, at Fair Value The following table presents the components of interest income on the Company’s Securities, at fair value: For the Year Ended December 31, (In Thousands) 2025 2024 2023 Agency MBS Coupon interest $ 107,951 $ 43,823 $ 20,676 Effective yield adjustment (1)(2) 10 ( 238 ) ( 146 ) Interest income $ 107,961 $ 43,585 $ 20,530 Other MBS Coupon interest $ 5,306 $ 7,840 $ 8,128 Effective yield adjustment (1)(2) 1,841 88 191 Interest income $ 7,147 $ 7,928 $ 8,319 Term notes backed by MSR collateral Coupon interest $ 1,789 $ 6,204 $ 8,423 Effective yield adjustment (2)(3) $ 4,361 $ 3,393 $ 5,104 Interest income $ 6,150 $ 9,597 $ 13,527 (1) Includes amortization of premium paid net of accretion of purchase discount. Interest income is recorded at an effective yield, which reflects net premium amortization/accretion based on actual prepayment activity. (2) The effective yield adjustment is the difference between the net income calculated using the net yield less the current coupon yield. The net yield may be based on management’s estimates of the amount and timing of future cash flows or on the instrument’s contractual cash flows, depending on the relevant accounting standards. (3) The effective yield adjustment for the year ended December 31, 2025 includes $ 2.6 million of accelerated discount accretion for MSR-related assets that were repaid in full during the second quarter of 2025. 90 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 5. Other Assets The following table presents the components of the Company’s Other assets at December 31, 2025 and 2024: (In Thousands) December 31, 2025 December 31, 2024 REO 135,035 130,854 Commercial REO 19,885 18,373 Goodwill 61,076 61,076 Intangibles, net (1) 2,600 4,800 Capital contributions made to loan origination partners 20,182 16,793 Commercial loans 6,079 7,435 Interest receivable 111,118 104,395 Other loan related receivables 8,874 21,643 Lease right-of-use asset (2) 42,810 35,461 Other 81,488 58,725 Total Other Assets $ 489,147 $ 459,555 (1) Net of aggregate accumulated amortization of $ 25.4 million and $ 23.2 million as of December 31, 2025 and 2024, respectively. (2) An estimated incremental borrowing rate of 7.5 % was used in connection with the Company’s primary operating lease, and an estimated incremental borrowing rate of 8.0 % was used in connection with Lima One’s headquarters lease (see Notes 2 and 9). (a) Real Estate Owned and Commercial REO The following table summarizes the aggregate carrying value of REO properties by loan source prior to foreclosure proceeding or from completion of a deed-in-lieu of foreclosure or similar legal agreement. (Dollars In Thousands) December 31, 2025 December 31, 2024 Non-QM loans $ 12,066 $ 1,278 Business purpose loans 80,822 71,090 Legacy RPL/NPL loans 42,147 58,486 Total $ 135,035 $ 130,854 Number of properties 322 416 At December 31, 2025, $ 135.0 million of residential real estate property was held by the Company that was acquired either through a completed foreclosure proceeding or from completion of a deed-in-lieu of foreclosure or similar legal agreement. In addition, formal foreclosure proceedings were in process with respect to $ 46.5 million of residential whole loans held at carrying value and $ 237.1 million of residential whole loans held at fair value at December 31, 2025. 91 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 The following table presents the activity in the Company’s REO for the years ended December 31, 2025 and 2024: For the Year Ended December 31, (Dollars In Thousands) 2025 2024 Balance at beginning of period $ 130,854 $ 110,174 Adjustments to record at lower of cost or fair value ( 12,581 ) ( 8,304 ) Transfer from residential whole loans (1) 107,105 103,666 Purchases and capital improvements, net 391 430 Disposals and other (2) ( 90,734 ) ( 75,112 ) Balance at end of period $ 135,035 $ 130,854 Number of properties 322 416 (1) The Company recognized $( 4.1 ) million and $( 6.7 ) million of gains/(losses), respectively, on Residential whole loans in Other Income/(Loss), net associated with the transfer of loans to REO for the years ended December 31, 2025 and December 31, 2024. (2) During the year ended December 31, 2025, the Company sold 399 REO properties for consideration of $ 95.8 million, realizing net gains of approximately $ 5.7 million. During the year ended December 31, 2024, the Company sold 257 REO properties for consideration of $ 85.3 million, realizing net gains of approximately $ 10.5 million. These amounts are included in Other Income/(Loss), net on the Company’s consolidated statements of operations. Commercial REO In the third quarter of 2024, the Company received 75 % and 49 % interests, respectively, in two VIEs through foreclosure of a multifamily property and a senior living facility underlying delinquent commercial mortgage loans. Each of these entities was determined to be a VIE but the Company was not determined to be the primary beneficiary; as a result, the investments in the entities are considered equity method investments. Each entity accounts for its respective commercial REO property (the “Commercial REO”) similarly to the manner in which the Company accounts for its residential REO. The entities generally do not own any other significant assets or carry any significant liabilities, except that the two entities contain properties encumbered by third-party financing. As of December 31, 2025, one property was considered held-for-investment and one property was considered held-for-sale. ( b ) Goodwill and Intangible Assets On July 1, 2021, the Company completed the acquisition of Lima One. In connection with the acquisition of Lima One, the Company identified and recorded goodwill of $ 61.1 million and finite-lived intangible assets totaling $ 28.0 million. For the Lima One reporting unit, through the most recent testing date (October 1, 2025), no impairment has been recorded since the goodwill was initially recognized as the estimated fair value of the reporting unit has consistently exceeded its carrying value. Key assumptions used in the valuation included loan origination volume, expense levels, discount rates and capitalization multiples, all of which are subject to variability in the current market. The amortization period for each of the finite lived intangible assets and the activity for the years ended December 31, 2025, 2024 and 2023 is summarized in the table below: (Dollars in Thousands) Carrying Value at December 31, 2022 Amortization Year Ended December 31, 2023 Amortization Year Ended December 31, 2024 Amortization Year Ended December 31, 2025 Carrying Value at December 31, 2025 Amortization Period (Years) (1) Trademarks / Trade Names $ 3,400 $ ( 400 ) $ ( 400 ) $ ( 400 ) $ 2,200 10 Customer Relationships 6,000 ( 3,000 ) ( 2,000 ) ( 1,000 ) — 4 Internally Developed Software 2,800 ( 800 ) ( 800 ) ( 800 ) 400 5 Total Identified Intangibles $ 12,200 $ ( 4,200 ) $ ( 3,200 ) $ ( 2,200 ) $ 2,600 (1) Amortization is calculated on a straight-line basis over the amortization period, except for Customer Relationships, where amortization is calculated based on expected levels of customer attrition . 92 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 ( c ) Capital Contributions Made to Loan Origination Partners The Company has made investments in several loan originators as part of its strategy to be a reliable source of capital to select partners from whom the Company sources residential mortgage loans through both flow arrangements and bulk purchases. At December 31, 2025, the carrying value of these investments (including adjustments for impairments or mark-to-market changes) was $ 20.2 million, including $ 5.1 million of common equity (including partnership interests) and $ 15.1 million of preferred equity. During the year ended December 31, 2025 and 2024, there were no impairment charges recorded by the Company on its investment in loan origination partners. During the year ended December 31, 2023, the Company recorded an impairment charge in earnings of $ 2.3 million against the carrying value of its investment in one loan origination partner. In 2023, the Company sold a preferred equity interest in one loan origination partner, which was recorded at $ 6.6 million, and recorded a gain of $ 0.1 million. This impairment charge was recorded in Provision for credit losses on other assets in the consolidated statement of operations. Prior to December 31, 2024, the Company had elected to account for certain of these investments pursuant to the fair value option, where changes in estimated fair value were recorded on the statement of operations. Such changes in estimated fair value resulted in gains/(losses) being recorded of $ 3.4 million, $( 3.0 ) million and $ 6.4 million during 2025, 2024, and 2023, respectively. For certain of the Company’s investments, the interests acquired to date by the Company generally do not have a readily determinable fair value. Consequently, the Company accounts for these interests (including any acquired options and warrants) in loan originators initially at cost. The carrying value of these investments will be adjusted if it is determined that an impairment has occurred or if there has been a subsequent observable transaction in either the investee company’s equity securities or a similar security that provides evidence to support an adjustment to the carrying value. In addition, for certain partners, options or warrants have also been acquired that provide the Company the ability to increase the level of its investment if certain conditions are met. At the end of each reporting period, or earlier if circumstances warrant, the Company evaluates whether the nature of its interests and other involvement with the investee entity requires the Company to apply equity method accounting or consolidate the results of the investee entity with the Company’s financial results. ( d) Commercial Mortgage Loans The Company owns two participations in commercial mortgage bridge loans, which are accounted for at fair value under the fair value option, and are classified as Level 3 fair value measurements in the fair value hierarchy. Each of the participations is 75 % of the total UPB of the related loans and the remaining interest in each loan was retained by the originator of such loan. The commercial mortgage loans are collateralized by one multifamily property and one office property. The commercial mortgage loans are first liens and bear variable interest rates. The following table presents certain additional information about the Company’s commercial mortgage loans: (Dollars In Thousands) Fair Value / Carrying Value UPB Weighted Average Coupon (1) Weighted Average Term to Maturity (Months) UPB 60+ Days Delinquent Weighted Average LTV Ratio Commercial Loans - December 31, 2025 $ 6,079 $ 9,385 10.60 % 0 $ 9,385 189 % Commercial Loans - December 31, 2024 $ 7,435 $ 9,385 11.48 % 0 $ 4,875 82 % (1) Commercial Loans contain contractual features which increase the loan’s interest rate following an event of default. The weighted average coupon presented is calculated based on each loan’s coupon rate without regard to post-default rate adjustments. (e) Derivative Instruments Swaps The Company’s derivative instruments include both interest rate swap agreements and ERIS swap futures, which are used to economically hedge the interest rate risk associated with certain borrowings. Pursuant to these arrangements, the Company agreed to pay a fixed rate of interest and receive a variable interest rate, generally based on the Secured Overnight Financing Rate (“SOFR”), on the notional amount of the Swap. At December 31, 2025, none of the Company’s Swaps were designated as hedges for accounting purposes. Variation margin payments on the Company’s Swaps are treated as a legal settlement of the exposure under the related Swap contract, the effect of which reduces what would have otherwise been reported as the fair value of the Swap, generally to zero. 93 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 The following table presents the assets pledged as collateral against the Company’s Swaps: (In Thousands) December 31, 2025 December 31, 2024 Agency MBS, at fair value $ 32,015 $ 44,411 Restricted Cash 24,317 16,567 At December 31, 2025, the Company had Swaps with an aggregate notional amount of $ 4.5 billion and an average maturity of approximately 46 months with a maximum term of approximately 120 months. The following table presents information about the Company’s Swaps at December 31, 2025 and 2024: December 31, 2025 December 31, 2024 Maturity (1) Notional Amount (2) Weighted Average Fixed-Pay Interest Rate Weighted Average Variable Interest Rate (3) Notional Amount (2) Weighted Average Fixed-Pay Interest Rate Weighted Average Variable Interest Rate (3) (Dollars in Thousands) Within 30 days $ — — % — % $ 450,000 1.16 % 4.49 % Over 30 days to 3 months — — — 100,000 1.65 4.49 Over 3 months to 6 months — — — 125,000 2.69 4.49 Over 6 months to 12 months 450,000 1.12 3.87 — — — Over 12 months to 24 months 1,065,000 1.85 3.87 450,000 1.12 4.49 Over 24 months to 36 months 341,500 3.23 3.87 1,045,000 1.84 4.49 Over 36 months to 48 months 332,800 2.96 3.87 24,600 4.28 4.49 Over 48 months to 60 months 1,463,900 3.36 3.87 574,000 3.28 4.49 Over 60 months to 72 months — — — — — — Over 72 months 827,300 3.36 3.87 545,150 3.42 4.49 Total Swaps $ 4,480,500 2.74 % 3.87 % $ 3,313,750 2.20 % 4.49 % (1) Each maturity category reflects contractual amortization and/or maturity of notional amounts. (2) As of December 31, 2025, the aggregate notional amounts of Swaps include $ 2.1 billion of interest rate swap agreements and $ 2.4 billion of ERIS swap futures. As of December 31, 2024, all aggregate notional amounts of Swaps were from interest rate swap agreements. (3) Reflects the benchmark variable rate due from the counterparty at the date presented. This rate adjusts daily based on SOFR. Impact of Derivative Instruments on Earnings The following table presents the components of Net gain/(loss) on derivatives used for risk management purposes for the years ended December 31, 2025, 2024 and 2023, which is presented in Other Income/(Loss), net in the consolidated statements of operations: For the Year Ended December 31, (In Thousands) 2025 2024 2023 Income on Swaps variable receive leg $ 155,923 $ 177,062 $ 158,554 Expense on Swaps fixed pay leg ( 94,432 ) ( 64,290 ) ( 51,400 ) Unrealized mark-to-market gain/(loss) ( 65,612 ) 2,478 ( 91,696 ) Net price alignment expense on margin collateral received ( 4,145 ) ( 9,217 ) ( 11,697 ) Realized gain/(loss) on terminated Swaps ( 27,278 ) ( 27,530 ) — Net gain on TBA short positions — — — Total Net gain/(loss) on derivatives used for risk management purposes $ ( 35,544 ) $ 78,503 $ 3,761 94 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 6. Financing Agreements The following tables present the components of, and certain information with respect to, the Company’s Financing agreements at December 31, 2025 and 2024: December 31, 2025 (Dollars In Thousands) Collateral Unpaid Principal Balance Fair Value/Carrying Value (1) Weighted Average Cost of Funding (2) Weighted Average Term to Maturity (Months) Agreements with mark-to-market collateral provisions Residential whole loans and REO $ 1,332,593 $ 1,331,967 6.07 % 11.4 Agreements with mark-to-market collateral provisions Securities 2,980,762 2,980,762 4.41 % 0.4 Total Agreements with mark-to-market collateral provisions $ 4,313,355 $ 4,312,729 5.14 % Agreements with non-mark-to-market collateral provisions Residential whole loans and REO 82,019 82,016 6.83 % 14.5 Securitized debt Residential whole loans 6,377,576 6,336,462 5.08 % See Note 14 Other secured financing (3) Other 23,908 23,908 6.47 % 54.4 8.875 % Senior Notes due 2029 Unsecured 115,000 112,041 9.83 % 37.5 9.00 % Senior Notes due 2029 Unsecured 75,000 72,858 9.94 % 43.5 Impact of net Swap carry ( 0.62 ) % Total Financing agreements (2) $ 10,986,858 $ 10,940,014 4.62 % December 31, 2024 (Dollars In Thousands) Collateral Unpaid Principal Balance Fair Value/Carrying Value (1) Weighted Average Cost of Funding (2) Weighted Average Term to Maturity (Months) Agreements with mark-to-market collateral provisions Residential whole loans and REO $ 1,321,584 $ 1,321,043 7.27 % 7.9 Agreements with mark-to-market collateral provisions Securities 1,279,007 1,279,007 5.47 % 0.2 Total Agreements with mark-to-market collateral provisions $ 2,600,591 $ 2,600,050 6.71 % Agreements with non-mark-to-market collateral provisions Residential whole loans and REO 577,231 576,774 7.82 % 10.4 Securitized debt Residential whole loans 5,891,815 5,794,977 4.82 % See Note 14 Convertible senior notes Unsecured — — 6.84 % 8.875 % Senior Notes due 2029 Unsecured 115,000 111,270 9.83 % 49.5 9.00 % Senior Notes due 2029 Unsecured 75,000 72,390 9.91 % 55.5 Impact of net Swap carry ( 1.24 ) % Total Financing agreements (2) $ 9,259,637 $ 9,155,461 4.54 % (1) The Company has both financing agreements held at fair value and financing agreements held at their carrying value (amortized cost basis). Financing agreements held at fair value are reported at estimated fair value each period as a result of the Company’s fair value option election. The fair value option was not elected for financing agreements held at carrying value. Consequently, total financing agreements as presented reflects a summation of balances reported at fair and carrying value. At December 31, 2025, the Company had $ 61.1 million of agreements with mark-to-market collateral provisions held at fair value, $ 48.2 million of agreements with non-mark-to-market collateral provisions held at fair value, and $ 5.8 billion of securitized debt held at fair value, with amortized cost bases of $ 61.1 million, $ 48.2 million, and $ 5.9 billion, respectively. At December 31, 2024, the Company had $ 19.8 million of agreements with mark-to-market collateral provisions held at fair value, $ 284.8 million of agreements with non-mark-to-market collateral provisions held at fair value, and $ 5.2 billion of securitized debt held at fair value, with amortized cost bases of $ 19.8 million, $ 284.8 million, and $ 5.3 billion, respectively. (2) Weighted average cost of funding reflects year-to-date interest expense (inclusive of the amortization of deferred financing costs) divided by average balance for the financing agreements. The cost of funding for the total financing agreements includes the impact of the net Swap carry (the difference between Swap interest income received and Swap interest expense paid) on the Company’s Swaps. For the year ended December 31, 2025, this decreased the overall funding cost by 62 basis points, and for the year ended December 31, 2024, this decreased the overall funding cost by 124 basis points. The Company does not allocate the impact of the net Swap carry by type of financing agreement. (3) Up to $ 20 million of the unpaid principal balance is subject to a 60-day call period at the counterparty’s option. 95 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 The following table presents maturities with respect to the Company’s financing agreements with mark-to-market and non-mark-to-market collateral provisions: As of December 31, 2025 Unpaid Principal Balance, Maturing In (In Thousands) Collateral 0-3 Months (1) 3-6 Months 6-12 Months Greater than 12 Months (2) Total Agreements with mark-to-market collateral provisions Residential whole loans $ 585,625 $ 49,404 $ 216,134 $ 481,430 $ 1,332,593 Agreements with mark-to-market collateral provisions Securities 2,980,762 — — — 2,980,762 Total Agreements with mark-to-market collateral provisions 3,566,387 49,404 216,134 481,430 4,313,355 Agreements with non-mark-to-market collateral provisions Residential whole loans 22,755 — 11,020 48,244 82,019 (1) $ 3.5 billion of the mark-to-market agreements (included in the 0-3 months category) can be terminated by either party. (2) Amounts presented are based on the assumed exercise of the Company’s unilateral option to extend by one year the maturity of an agreement with mark-to-market collateral provisions with $ 304.3 million outstanding. The longest maturity date is approximately 33 months. The following table presents information with respect to the Company’s financing agreements with mark-to-market collateral provisions and associated assets pledged as collateral at December 31, 2025 and 2024: (Dollars in Thousands) December 31, 2025 December 31, 2024 Mark-to-market financing agreements secured by residential whole loans (1) $ 1,308,661 $ 1,295,653 Fair value of residential whole loans pledged as collateral under financing agreements $ 1,642,252 $ 1,608,344 Weighted average haircut on residential whole loans (2) 20.28 % 19.24 % Mark-to-market financing agreements secured by securities at fair value $ 2,980,762 $ 1,279,007 Securities at fair value pledged as collateral under financing agreements $ 3,107,405 $ 1,352,918 Weighted average haircut on securities at fair value (2) 3.82 % 4.99 % Mark-to-market financing agreements secured by real estate owned $ 23,307 $ 25,390 Fair value of real estate owned pledged as collateral under financing agreements $ 41,072 $ 62,659 Weighted average haircut on real estate owned (2) 42.24 % 55.71 % (1) Includes an aggregate of $ 466.9 million and $ 394.9 million of mark-to-market financing collateralized by Non-Agency MBS with a fair value of $ 600.0 million and $ 506.6 million obtained in connection with the Company’s loan securitization transactions that are eliminated in consolidation as of December 31, 2025 and December 31, 2024, respectively. (2) Haircut represents the percentage amount by which the collateral value is contractually required to exceed the amount borrowed. The following table presents information with respect to the Company’s financing agreements with non-mark-to-market collateral provisions and associated assets pledged as collateral at December 31, 2025 and 2024: (Dollars in Thousands) December 31, 2025 December 31, 2024 Non-mark-to-market financing secured by residential whole loans $ 82,016 $ 576,774 Fair value of residential whole loans pledged as collateral under financing agreements $ 115,326 $ 740,494 Weighted average haircut on residential whole loans 28.88 % 21.40 % Non-mark-to-market financing secured by real estate owned $ — $ — Fair value of real estate owned pledged as collateral under financing agreements $ — $ — Weighted average haircut on real estate owned — % — % In addition, the Company had aggregate restricted cash held in connection with its financing agreements, including securitized debt, of $ 25.5 million and $ 32.1 million at December 31, 2025 and 2024, respectively. 96 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 The following table presents repricing information (excluding the impact of associated derivative hedging instruments, if any) about the Company’s financing agreements that have non-mark-to-market collateral provisions as well as those that have mark-to-market collateral provisions, at December 31, 2025 and 2024: December 31, 2025 December 31, 2024 Amortized Cost Basis Weighted Average Interest Rate Amortized Cost Basis Weighted Average Interest Rate Time Until Interest Rate Reset (Dollars in Thousands) Within 30 days $ 4,395,375 4.49 % $ 3,177,822 5.85 % Over 30 days to 3 months — — — — Over 3 months to 12 months — — — — Over 12 months — — — — Total financing agreements $ 4,395,375 4.49 % $ 3,177,822 5.85 % (a) Other Information on Financing Agreements Convertible Senior Notes In June 2019, the Company issued $ 230.0 million in aggregate principal amount of its Convertible Senior Notes in an underwritten public offering. The total net proceeds the Company received from the offering were approximately $ 223.3 million, after deducting offering expenses and the underwriting discount. The Convertible Senior Notes bore interest at a fixed rate of 6.25 % per year. The Convertible Senior Notes were convertible at the option of the holders at any time until the close of business on the business day immediately preceding the maturity date into shares of the Company’s common stock based on a conversion rate of 31.4346 shares (which reflected an adjustment resulting from the Company’s Reverse Stock Split) of the Company’s common stock for each $ 1,000 principal amount of the Convertible Senior Notes, which is equivalent to a conversion price of approximately $ 31.81 per share of common stock. The Convertible Senior Notes had an effective interest rate, including the impact of amortization to interest expense of debt issuance costs, of 6.94 %. During the three months ended June 30, 2024, the Convertible Senior Notes matured and the Company repaid the then remaining outstanding amount in full. In February 2023, the Company’s Board authorized a repurchase program for its Convertible Senior Notes pursuant to which it could have repurchased up to $ 100 million of its Convertible Senior Notes. During the three months ended March 31, 2024, the Company repurchased $ 39.9 million principal amount of its Convertible Senior Notes for $ 39.8 million and recorded a loss of $ 0.1 million to Other Income/(Loss), net on the consolidated statement of operations. During the year ended December 31, 2023, the Company repurchased $ 20.4 million principal amount of the Convertible Senior Notes for $ 20.2 million and recorded a gain of $ 0.1 million to Other Income/(Loss), net on the consolidated statement of operations. 8.875 % Senior Notes due 2029 (“ 8.875 % Senior Notes”) In January 2024, the Company completed the issuance of $ 115.0 million in aggregate principal amount of its 8.875 % Senior Notes in an underwritten public offering. The 8.875 % Senior Notes are senior unsecured obligations of the Company and bear interest at a rate equal to 8.875 % per year, payable in cash quarterly in arrears on February 15, May 15, August 15, and November 15 of each year, beginning on May 15, 2024, and are expected to mature on February 15, 2029, unless earlier redeemed. The Company may redeem the 8.875 % Senior Notes in whole or in part at any time at the Company’s option on or after February 15, 2026, at a redemption price equal to 100 % of the outstanding principal amount of the 8.875 % Senior Notes to be redeemed plus accrued and unpaid interest to, but excluding, the redemption date. The total net proceeds to the Company from the offering of the 8.875 % Senior Notes, after deducting the underwriter’s discount and commissions and offering expenses, were approximately $ 110.6 million. The 8.875 % Senior Notes have an effective interest rate, including the impact of amortization to interest expense of debt issuance costs, of 9.83 %. 97 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 9.00 % Senior Notes due 2029 (“ 9.00 % Senior Notes”) On April 17, 2024, the Company completed the issuance of $ 75.0 million in aggregate principal amount of its 9.00 % Senior Notes in an underwritten public offering. The 9.00 % Senior Notes are senior unsecured obligations of the Company and bear interest at a rate equal to 9.00 % per year, payable in cash quarterly in arrears on February 15, May 15, August 15, and November 15 of each year, beginning on August 15, 2024, and are expected to mature on August 15, 2029, unless earlier redeemed. The Company may redeem the 9.00 % Senior Notes in whole or in part at any time at the Company’s option on or after August 15, 2026, at a redemption price equal to 100 % of the outstanding principal amount of the 9.00 % Senior Notes to be redeemed plus accrued and unpaid interest to, but excluding, the redemption date. The total net proceeds to the Company from the offering of the 9.00 % Senior Notes, after deducting the underwriter’s discount and commissions and offering expenses, were approximately $ 72.0 million. The 9.00 % Senior Notes have an effective interest rate, including the impact of amortization to interest expense of debt issuance costs, of 9.94 %. Both the 8.875 % Senior Notes and the 9.00 % Senior Notes are the Company’s senior unsecured obligations and are (i) effectively junior to all of the Company’s secured indebtedness, which includes the Company’s repurchase agreements and other financing arrangements, to the extent of the value of the collateral securing such indebtedness and (ii) equal in right of payment to each other and to the Company’s existing and future senior unsecured obligations, if any. (b) Counterparties The Company had financing agreements, including repurchase agreements and other forms of secured financing, with 16 and 15 counterparties at December 31, 2025 and 2024, respectively. The following table presents information with respect to each counterparty under financing agreements for which the Company had greater than 5 % of stockholders’ equity at risk in the aggregate at December 31, 2025: December 31, 2025 Counterparty Amount at Risk (1) Weighted Average Months to Maturity Percent of Stockholders’ Equity (Dollars in Thousands) Wells Fargo $ 134,564 3.3 7.36 % (1) The amount at risk reflects the difference between (a) the amount loaned to the Company through financing agreements, including interest payable, and (b) the cash and the fair value of the assets pledged by the Company as collateral, including accrued interest receivable on such assets. 98 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 (c) Pledged Collateral The following tables present the Company’s assets (based on carrying value) pledged as collateral for its various financing arrangements as of December 31, 2025 and 2024: December 31, 2025 Financing Agreements (In Thousands) Securitized Non-Mark-to-Market (1) Mark-to-Market (1) Total Assets: Residential whole loans (2) $ 7,605,654 $ 115,326 $ 1,043,363 $ 8,764,343 Securities, at fair value — — 3,107,405 3,107,405 Other assets: REO 52,370 — 37,002 89,372 Total $ 7,658,024 $ 115,326 $ 4,187,770 $ 11,961,120 December 31, 2024 Financing Agreements (In Thousands) Securitized Non-Mark-to-Market (1) Mark-to-Market (1) Total Assets: Residential whole loans (2) $ 6,886,776 $ 740,260 $ 1,107,079 $ 8,734,115 Securities, at fair value — — 1,352,918 1,352,918 Other assets: REO 26,934 — 56,505 83,439 Total $ 6,913,710 $ 740,260 $ 2,516,502 $ 10,170,472 (1) An aggregate of $ 27.0 million and $ 27.1 million of accrued interest on those assets pledged against non-mark-to-market and mark-to-market financing agreements had also been pledged as of December 31, 2025 and 2024, respectively. (2) Includes an aggregate of $ 466.9 million and $ 394.9 million of mark-to-market financing collateralized by Non-Agency MBS with a fair value of $ 600.0 million and $ 506.6 million obtained in connection with the Company’s loan securitization transactions that are eliminated in consolidation as of December 31, 2025 and December 31, 2024, respectively. The Company pledges securities or cash as collateral to its counterparties in relation to certain of its financing arrangements. The Company exchanges collateral with its counterparties based on changes in the fair value, notional amount and term of the associated financing arrangements and Swaps, as applicable. In connection with these margining practices, either the Company or its counterparty may be required to pledge cash or securities as collateral. When the Company’s pledged collateral exceeds the required margin, the Company may initiate a reverse margin call, at which time the counterparty may either return the excess collateral or provide collateral to the Company in the form of cash or equivalent securities. The Company’s assets pledged as collateral are also described in Notes 2(e) - Restricted Cash and 5(e) - Derivative Instruments. Certain of the Company’s financing arrangements and derivative transactions are governed by underlying agreements that generally provide for a right of setoff in the event of default or in the event of a bankruptcy of either party to the transaction. In the Company’s consolidated balance sheets, all balances associated with repurchase agreements are presented on a gross basis. 7 . Other Liabilities The following table presents the components of the Company’s Other liabilities at December 31, 2025 and 2024: (In Thousands) December 31, 2025 December 31, 2024 Payable for unsettled investment purchases $ — $ 63,094 Dividends and dividend equivalents payable 37,136 36,021 Lease liability 53,431 41,050 Accrued interest payable 36,369 33,050 Accrued expenses and other 151,804 239,136 Total Other Liabilities $ 278,740 $ 412,351 99 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 8. Income Taxes The Company has elected to be taxed as a REIT under the provisions of the Internal Revenue Code of 1986, as amended, (the “Code”), and the corresponding provisions of state law. The Company expects to operate in a manner that will enable it to satisfy the various requirements to maintain its status as a REIT for federal income tax purposes. In order to maintain its status as a REIT, the Company must, among other things, distribute at least 90% of its REIT taxable income (excluding net long-term capital gains) to stockholders in the timeframe permitted by the Code. As long as the Company maintains its status as a REIT, the Company will not be subject to regular federal income tax at the REIT level to the extent that it distributes 100% of its REIT taxable income (including net long-term capital gains) to its stockholders within the permitted timeframe. Should this not occur, the Company would be subject to federal taxes at prevailing corporate tax rates on the difference between its REIT taxable income and the amounts deemed to be distributed for that tax year. The Company’s objective is to distribute 100 % of its REIT taxable income to its stockholders within the permitted timeframe. If the Company fails to distribute during each calendar year, or by the end of January following the calendar year in the case of distributions with declaration and record dates falling in the last three months of the calendar year, at least the sum of (i) 85% of its REIT ordinary income for such year, (ii) 95% of its REIT capital gain income for such year, and (iii) any undistributed taxable income from prior periods, the Company would be subject to a 4% nondeductible excise tax on the excess of the required distribution over the amounts actually distributed. To the extent that the Company incurs interest, penalties or related excise taxes in connection with its tax obligations, including as a result of its assessment of uncertain tax positions, such amounts will be included in Operating and Other Expense on the Company’s consolidated statements of operations. In addition, the Company has elected to treat certain of its subsidiaries as TRS. In general, a TRS may hold assets and engage in activities that the Company cannot hold or engage in directly and generally may engage in any real estate or non-real estate-related business. Generally, a domestic TRS is subject to U.S. federal, state and local corporate income taxes. Given that a portion of the Company’s business is conducted through one or more TRS, the net taxable income earned by its domestic TRS, if any, is subject to corporate income taxation. To maintain the Company’s REIT election, no more than 20% (25% for taxable years beginning after December 31, 2025) of the value of the Company’s assets at the end of each calendar quarter may consist of stock or securities in TRS. For purposes of the determination of U.S. federal and state income taxes, the Company’s subsidiaries that elected to be treated as TRS record current or deferred income taxes based on differences (both permanent and timing) between the determination of their taxable income and net income under GAAP. Based on its analysis of any potentially uncertain tax positions, the Company concluded that it does not have any material uncertain tax positions that meet the relevant recognition or measurement criteria as of December 31, 2025 or 2024. As of the date of this filing, the Company’s tax returns for tax years 2022 through 2024 are open to examination. The tax effects of temporary differences that give rise to significant portions of net deferred tax assets (“DTAs”) recorded at the Company’s domestic TRS entities at December 31, 2025 and 2024 are presented in the following table: (In Thousands) December 31, 2025 December 31, 2024 Deferred tax assets (DTAs): Net operating loss and tax credit carryforwards $ 104,004 $ 89,910 Unrealized mark-to-market, impairments and loss provisions 17,602 18,004 Other realized / unrealized treatment differences ( 39,080 ) ( 45,234 ) Total deferred tax assets 82,526 62,680 Less: valuation allowance ( 82,526 ) ( 62,680 ) Net deferred tax assets $ — $ — Realization of the Company’s DTAs at December 31, 2025 is dependent on several factors, including generating sufficient taxable income to utilize net operating loss (“NOL”) carryforwards and generating sufficient capital gains in future periods prior to the expiration of capital loss carryforwards. The Company determines the extent to which realization of the deferred assets is not expected to be more likely than not and establishes a valuation allowance accordingly. No net deferred tax benefit was recorded by the Company for the years ended December 31, 2025 and 2024, related to the net taxable losses in TRS entities, since a valuation allowance for the full amount of the associated deferred tax asset at the ends of those periods was recognized as its recovery was not considered more likely than not. The related NOL carryforwards can be carried forward indefinitely, until fully utilized. The Company’s estimate of net DTAs could change in future periods to the extent that actual or revised estimates of future taxable income change from current expectations. 100 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 At December 31, 2025, the Company’s federal NOL carryforward from prior years was $ 354.0 million, which may be carried forward indefinitely. If certain substantial changes in the Company’s ownership occur, there could be an annual limitation on the amount of the carryforwards that can be utilized. The following table summarizes the Company’s income tax provision/(benefit) primarily recorded at the Company’s domestic TRS entities for the years ended December 31, 2025, 2024, and 2023: For the Year Ended (In Thousands) December 31, 2025 December 31, 2024 December 31, 2023 Current provision/(benefit) Federal $ ( 489 ) $ 417 $ ( 21 ) State ( 246 ) 26 — Total current provision/(benefit) ( 735 ) 443 ( 21 ) Deferred provision/(benefit) Federal — — 251 State — — 48 Total deferred provision/(benefit) — — 299 Total provision/(benefit) $ ( 735 ) $ 443 $ 278 As further described in Note 2(s), the Company has elected to retrospectively adopt the guidance in ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Taxes Disclosures, or ASU 2023-09. The following is a reconciliation of the statutory federal tax rate to the Company’s effective tax rate for the years ended December 31, 2025, 2024, and 2023: For the Year Ended December 31, 2025 December 31, 2024 December 31, 2023 (Dollars in Thousands) Amount Percentage Amount Percentage Amount Percentage U.S. Federal statutory tax rate $ 36,970 21.0 % $ 25,136 21.0 % $ 16,893 21.0 % State and local taxes, net of federal income tax effect (1) 246 0.1 % ( 26 ) — % ( 48 ) ( 0.1 ) % Changes in valuation allowances 16,014 9.1 % ( 7,641 ) ( 6.4 ) % ( 7,706 ) ( 9.6 ) % Nontaxable or nondeductible items REIT GAAP income or loss not subject to federal income tax ( 26,714 ) ( 15.2 ) % ( 9,171 ) ( 7.7 ) % ( 16,123 ) ( 20.0 ) % VIE income or loss ( 18,693 ) ( 10.6 ) % ( 1,124 ) ( 0.9 ) % 7,072 8.8 % TRS permanent differences 280 0.2 % — — % 607 0.8 % Basis difference in contributed assets to subsidiaries ( 8,307 ) ( 4.7 ) % ( 6,616 ) ( 5.5 ) % — — % Other adjustments ( 531 ) ( 0.3 ) % ( 115 ) ( 0.2 ) % ( 417 ) ( 0.6 ) % Effective tax rate $ ( 735 ) ( 0.4 ) % $ 443 0.3 % $ 278 0.3 % (1) The jurisdictions that contribute to the majority (greater than 50%) of the tax effect in this category include California, Maine, Minnesota, New Jersey, and Pennsylvania for 2025. No jurisdictions materially contributed to the majority (greater than 50%) of the net tax effect in this category for 2024 and 2023. The amount of cash taxes paid by (refunded to) the Company by jurisdiction for the year ended: For the Year Ended (In Thousands) December 31, 2025 Federal $ 656 Pennsylvania ( 100 ) Other states 8 Total cash taxes paid (refunded) $ 564 101 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 9. Commitments and Contingencies (a) Lease Commitments The Company’s primary lease commitment relates to its corporate headquarters. For the years ended December 31, 2025, 2024, and 2023, the Company recorded an expense in connection with this lease of approximately $ 5.3 million, $ 5.4 million, and $ 5.2 million, respectively. The original term specified in this lease is approximately fifteen years with a termination date of December 2036 and an option to renew for an additional five years . Additionally, in December 2024, Lima One executed a new office lease for its headquarters in Greenville, South Carolina. Lima One moved into the new office space on July 15, 2025. For the year ended December 31, 2025, the Company recorded an expense in connection with this lease of approximately $ 2.1 million. The original term specified in this lease is approximately nine years with a termination date of December 2033 and two options to renew for an additional four years for the first extension and an additional five years for the second extension. The Company recognized total lease expense of $ 8.6 million, $ 7.4 million and $ 6.7 million for the years ended December 31, 2025, 2024 and 2023, respectively, which is included in Other general and administrative expense on the Company’s consolidated statements of operations. At December 31, 2025, the contractual minimum rental payments (exclusive of possible rent escalation charges and normal recurring charges for maintenance, insurance and taxes) for the Company’s lease commitments were as follows: Year Ended December 31, Minimum Rental Payments (In Thousands) 2026 $ 7,377 2027 7,731 2028 7,547 2029 7,529 2030 7,513 Thereafter 39,633 Total $ 77,329 Present Value Discount ( 23,898 ) Total Lease Liability (Note 7) $ 53,431 (b) Representations and Warranties in Connection with Loan Securitization and Other Loan Sale Transactions In connection with the loan securitization and sale transactions entered into by the Company, the Company has the obligation under certain circumstances to repurchase assets previously transferred to securitization vehicles, or otherwise sold, upon breach of certain representations and warranties. As of December 31, 2025, the Company was not aware of any material unsettled repurchase claims that would require a reserve (see Note 14). (c) Loan Commitments At December 31, 2025, the Company had unfunded commitments in connection with its Single-family and Multifamily transitional loans of $ 271.2 million and $ 23.2 million, respectively (see Note 3). These commitments are subject to certain conditions that the respective borrowers must meet before funding is required. In addition, from time to time, Lima One makes short-term commitments to originate mortgage loans; such commitments were not significant at December 31, 2025. (d) Guarantee In connection with one of its investments in a loan origination partner, the Company has guaranteed up to $ 51.0 million of such investee’s warehouse financing. As of December 31, 2025, the Company has no t recorded a loss in connection with this guarantee. 102 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 (e) Litigation The Company reserves for contingent liabilities when it is determined that a liability is probable and reasonably estimable. Litigation is subject to many factors that are difficult to predict, so there can be no assurance that, in the event of a material unfavorable result in one or more claims, the Company will not incur material costs. The Company is not presently named as a defendant in any material litigation arising outside the ordinary course of business. However, the Company is from time to time involved in litigation arising in the course of its business activities. During the year ended December 31, 2025, the Company recorded an aggregate litigation reserve totaling $ 1.2 million within Other Income/(Loss), net and estimates additional reasonably possible losses of up to $ 1.5 million. 10. Stockholders’ Equity ( a ) Preferred Stock 7.50 % Series B Cumulative Redeemable Preferred Stock (“Series B Preferred Stock”) On April 15, 2013, the Company completed the issuance of 8.0 million shares of its Series B Preferred Stock with a par value of $ 0.01 per share, and a liquidation preference of $ 25.00 per share plus accrued and unpaid dividends, in an underwritten public offering. On August 15, 2025, the Company filed an articles supplementary to the amended and restated articles of incorporation, which increased the number of authorized shares of Series B Preferred Stock to 12.1 million from 8.1 million. Also on August 15, 2025, the Company entered into a distribution agreement pursuant to the terms of which the Company may, from time to time, offer and sell shares of its preferred stock having an aggregate gross sales price of up to $ 100.0 million. During the year ended December 31, 2025, approximately 125,000 shares of Series B Preferred Stock were issued for gross proceeds of approximately $ 2.7 million. The Company’s Series B Preferred Stock is entitled to receive a dividend at a rate of 7.50 % per year on the $ 25.00 liquidation preference before the Company’s common stock is paid any dividends and is senior to the Company’s common stock with respect to distributions upon liquidation, dissolution or winding up. Dividends on the Series B Preferred Stock are payable quarterly in arrears on or about March 31, June 30, September 30 and December 31 of each year. The Series B Preferred Stock is redeemable at $ 25.00 per share plus accrued and unpaid dividends (whether or not authorized or declared), exclusively at the Company’s option. The Series B Preferred Stock generally does not have any voting rights, subject to an exception in the event the Company fails to pay dividends on such stock for six or more quarterly periods (whether or not consecutive). Under such circumstances, the Series B Preferred Stock will be entitled to vote to elect two additional directors to the Company’s Board of Directors (the “Board”), until all unpaid dividends have been paid or declared and set apart for payment. In addition, certain material and adverse changes to the terms of the Series B Preferred Stock cannot be made without the affirmative vote of holders of at least 66.67 % of the outstanding shares of Series B Preferred Stock. The following table presents cash dividends declared by the Company on its Series B Preferred Stock from January 1, 2023 through December 31, 2025: Year Declaration Date Record Date Payment Date Annual Dividend Rate Dividend Per Share 2025 November 20, 2025 December 4, 2025 December 31, 2025 7.50 % $ 0.46875 August 21, 2025 September 4, 2025 September 30, 2025 7.50 0.46875 May 19, 2025 June 4, 2025 June 30, 2025 7.50 0.46875 February 18, 2025 March 4, 2025 March 31, 2025 7.50 0.46875 2024 November 20, 2024 December 3, 2024 December 31, 2024 7.50 0.46875 August 16, 2024 August 30, 2024 September 30, 2024 7.50 0.46875 May 21, 2024 June 5, 2024 June 28, 2024 7.50 0.46875 February 20, 2024 March 5, 2024 March 28, 2024 7.50 0.46875 2023 November 21, 2023 December 4, 2023 December 29, 2023 7.50 0.46875 August 17, 2023 September 5, 2023 September 29, 2023 7.50 0.46875 May 22, 2023 June 5, 2023 June 30, 2023 7.50 0.46875 February 21, 2023 March 6, 2023 March 31, 2023 7.50 0.46875 103 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 6.50 % Series C Fixed-to-Floating Rate Cumulative Redeemable Preferred Stock (“Series C Preferred Stock”) On February 28, 2020, the Company amended its charter through the filing of articles supplementary to reclassify 12,650,000 shares of the Company’s authorized but unissued common stock as shares of the Company’s Series C Preferred Stock. On March 2, 2020, the Company completed the issuance of 11.0 million shares of its Series C Preferred Stock with a par value of $ 0.01 per share, and a liquidation preference of $ 25.00 per share plus accrued and unpaid dividends, in an underwritten public offering. The total net proceeds the Company received from the offering were approximately $ 266.0 million, after deducting offering expenses and the underwriting discount. On August 15, 2025, the Company filed an articles supplementary to the amended and restated articles of incorporation, which increased the number of authorized shares of Series C Preferred Stock to 16.7 million from 12.7 million. Also on August 15, 2025, the Company entered into a distribution agreement pursuant to the terms of which the Company may, from time to time, offer and sell shares of its preferred stock having an aggregate gross sales price of up to $ 100.0 million. During the year ended December 31, 2025, approximately 286,000 shares of Series C Preferred Stock were issued for gross proceeds of approximately $ 6.9 million. The Company’s Series C Preferred Stock is entitled to receive dividends (i) from and including the original issue date to, but excluding, March 31, 2025, at a fixed rate of 6.50 % per year on the $ 25.00 liquidation preference and (ii) from and after March 31, 2025, at a floating rate equal to three-month London Interbank Offered Rate (“LIBOR”) plus a spread of 5.345 % per year of the $ 25.00 per share liquidation preference before the Company’s common stock is paid any dividends, and is senior to the Company’s common stock with respect to distributions upon liquidation, dissolution or winding up. In light of the discontinuance of the publication of three-month LIBOR after June 2023, and pursuant to the Adjustable Interest Rate (LIBOR) Act and the Federal Reserve’s final rules promulgated thereunder, the three-month CME Term SOFR (Secured Overnight Financing Rate) has replaced three-month LIBOR as the successor base rate and includes an additional spread adjustment of 0.26161 % per year based on the recommendation from the Alternative Reference Rate Committee. Dividends on the Series C Preferred Stock are payable quarterly in arrears on or about March 31, June 30, September 30 and December 31 of each year. The Series C Preferred Stock is not redeemable by the Company prior to March 31, 2025, except under circumstances where it is necessary to preserve the Company’s qualification as a REIT for U.S. federal income tax purposes and upon the occurrence of certain specified change in control transactions. On or after March 31, 2025, the Company may, at its option, subject to certain procedural requirements, redeem any or all of the shares of the Series C Preferred Stock for cash at a redemption price of $ 25.00 per share, plus any accrued and unpaid dividends thereon (whether or not authorized or declared) to, but excluding, the redemption date. The Series C Preferred Stock generally does not have any voting rights, subject to an exception in the event the Company fails to pay dividends on such stock for six or more quarterly periods (whether or not consecutive). Under such circumstances, the Series C Preferred Stock will be entitled to vote to elect two additional directors to the Company’s Board, until all unpaid dividends have been paid or declared and set apart for payment. In addition, certain material and adverse changes to the terms of the Series C Preferred Stock cannot be made without the affirmative vote of holders of at least 66.67 % of the outstanding shares of Series C Preferred Stock. The following table presents cash dividends declared by the Company on its Series C Preferred Stock from January 1, 2023 through December 31, 2025: Year Declaration Date Record Date Payment Date Annual Dividend Rate Dividend Per Share 2025 November 20, 2025 December 4, 2025 December 31, 2025 9.60811 % $ 0.613850 September 2, 2025 September 4, 2025 September 30, 2025 9.90226 0.639521 May 19, 2025 June 4, 2025 June 30, 2025 9.90578 0.619110 February 18, 2025 March 4, 2025 March 31, 2025 6.50000 0.406250 2024 November 20, 2024 December 3, 2024 December 31, 2024 6.50000 0.406250 August 16, 2024 August 30, 2024 September 30, 2024 6.50000 0.406250 May 21, 2024 June 5, 2024 June 28, 2024 6.50000 0.406250 February 20, 2024 March 5, 2024 March 28, 2024 6.50000 0.406250 2023 November 21, 2023 December 4, 2023 December 29, 2023 6.50000 0.406250 August 17, 2023 September 5, 2023 September 29, 2023 6.50000 0.406250 May 22, 2023 June 5, 2023 June 30, 2023 6.50000 0.406250 February 21, 2023 March 6, 2023 March 31, 2023 6.50000 0.406250 104 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 (b) Dividends on Common Stock The following table presents cash dividends declared by the Company on its common stock from January 1, 2023 through December 31, 2025: Year Declaration Date Record Date Payment Date Dividend Per Share 2025 December 11, 2025 December 31, 2025 January 30, 2026 $ 0.36 (1) September 11, 2025 September 30, 2025 October 31, 2025 0.36 June 12, 2025 June 30, 2025 July 31, 2025 0.36 March 6, 2025 March 31, 2025 April 30, 2025 0.36 2024 December 11, 2024 December 31, 2024 January 31, 2025 0.35 (2) September 12, 2024 September 27, 2024 October 31, 2024 0.35 June 11, 2024 June 28, 2024 July 31, 2024 0.35 March 7, 2024 March 28, 2024 April 30, 2024 0.35 2023 December 13, 2023 December 29, 2023 January 31, 2024 0.35 (3) September 20, 2023 October 2, 2023 October 31, 2023 0.35 June 15, 2023 June 30, 2023 July 31, 2023 0.35 March 10, 2023 March 31, 2023 April 28, 2023 0.35 (1) At December 31, 2025, the Company had accrued dividends and dividend equivalents payable of $ 37.1 million related to the common stock dividend declared on December 11, 2025. This dividend will be treated as a dividend paid in 2026 to the extent of the Company’s earnings and profits in 2026. (2) At December 31, 2024, the Company had accrued dividends and dividend equivalents payable of $ 36.0 million related to the common stock dividend declared on December 11, 2024. A portion of this dividend was considered taxable income to the recipient in 2025. For more information see the Company’s 2025 Dividend Tax Information on its website. (3) At December 31, 2023, the Company had accrued dividends and dividend equivalents payable of $ 35.8 million related to the common stock dividend declared on December 13, 2023. A portion of this dividend was considered taxable income to the recipient in 2024. For more information see the Company’s 2024 Dividend Tax Information on its website. In general, the Company’s common stock dividends have been characterized as ordinary income to its stockholders for income tax purposes. However, a portion of the Company’s common stock dividends may, from time to time, be characterized as capital gains or return of capital. For the year ended December 31, 2025, the portion of the Company’s common stock dividends paid during the year deemed to be a return of capital was $ 0.5800 per share of common stock. For the year ended December 31, 2024, the portion of the Company’s common stock dividends paid during the year deemed to be a return of capital was $ 0.5516 per share of common stock. For the year ended December 31, 2023, the portion of the Company’s common stock dividends paid during the year deemed to be a return of capital was $ 0.4108 per share of common stock. (c) Discount Waiver, Direct Stock Purchase and Dividend Reinvestment Plan (“DRSPP”) On September 27, 2022, the Company filed a shelf registration statement on Form S-3 with the SEC under the Securities Act of 1933, as amended (the “Securities Act”), for the purpose of registering common stock for sale through its DRSPP. Pursuant to Rule 462(e) under the Securities Act, this shelf registration statement became effective automatically upon filing with the SEC and, registered an aggregate of 2.0 million shares of common stock. The Company’s DRSPP is designed to provide existing stockholders and new investors with a convenient and economical way to purchase shares of common stock through the automatic reinvestment of dividends and/or optional cash investments. The DRSPP shelf registration statement expired by its terms on September 27, 2025. During the years ended December 31, 2025, 2024 and 2023, the Company issued 0 , 0 and 6,666 shares of common stock through the DRSPP, raising net proceeds of approximately $ 0 , $ 0 and $ 74,000 , respectively. From the inception of the DRSPP in September 2003 through December 31, 2025, the Company issued 8,848,219 shares pursuant to the DRSPP, raising net proceeds of $ 290.8 million. (d) Preferred Stock At-the-Market Offering Program On August 15, 2025, the Company entered into a distribution agreement pursuant to the terms of which the Company may, from time to time, offer and sell shares of its Series B Preferred Stock and/or its Series C Preferred Stock having an aggregate gross sales price of up to $ 100.0 million, through various sales agents in transactions deemed to be “at-the-market” offerings under federal securities laws (the “Preferred Stock ATM Program”). The Company sold an aggregate of approximately 411,000 shares of 105 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 preferred stock through the Preferred Stock ATM Program during the year ended December 31, 2025 for gross sales proceeds of approximately $ 9.5 million. As of December 31, 2025, approximately $ 90.5 million remained available under the Preferred Stock ATM Program. (e) Common Stock At-the-Market Offering Program On August 15, 2025, the Company entered into a distribution agreement pursuant to the terms of which the Company may offer and sell shares of its common stock having an aggregate gross sales price of up to $ 300.0 million, from time to time, through various sales agents in transactions deemed to be “at-the-market” offerings under federal securities laws (the “Common Stock ATM Program”). The prior distribution agreement entered into on February 29, 2024, which had substantially the same terms, was terminated. The Company did not sell any shares of common stock through the Common Stock ATM Program during the years ended December 31, 2025 and 2024. (f) Stock Repurchase Program On February 29, 2024, the Company announced its Board had authorized a $ 200 million stock repurchase program with respect to the Company’s common stock, which was in effect through the end of 2025. Approximately $ 190 million remained available for repurchase under the stock repurchase program upon its expiration. On February 12, 2026, the Company’s Board authorized a new $ 200 million stock repurchase program with respect to the Company’s common stock, which will be in effect through December 31, 2028. The stock repurchase program does not require the purchase of any minimum number of shares. The timing and extent to which the Company repurchases its shares will depend upon, among other things, market conditions, share price, liquidity, regulatory requirements and other factors, and repurchases may be commenced or suspended at any time without prior notice. Acquisitions under the stock repurchase program may be made in the open market, through privately negotiated transactions or block trades or other means, in accordance with applicable securities laws (including, in the Company’s discretion, through the use of one or more plans adopted under Rule 10b5-1 promulgated under the Exchange Act of 1934, as amended (the “Exchange Act”)). During the year ended December 31, 2025, the Company repurchased 1,026,117 shares of its common stock through the stock repurchase program at an average cost of $ 9.76 per share and a total cost of approximately $ 10.0 million, net of fees and commissions paid to the sales agent of approximately $ 10,000 . The Company did not repurchase any shares of its common stock during the year ended December 31, 2024 and 2023. 106 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 (g) Accumulated Other Comprehensive Income/(Loss) The following tables present changes in the balances of each component of the Company’s AOCI: For the Year Ended December 31, 2025 (In Thousands) Net Unrealized Gain/(Loss) on AFS Securities Net Unrealized Gain/(Loss) on Financing Agreements (1) Total AOCI Balance at beginning of period $ 9,476 $ — $ 9,476 OCI before reclassifications ( 5,575 ) — ( 5,575 ) Amounts reclassified from AOCI ( 226 ) — ( 226 ) Net OCI during the period (2) ( 5,801 ) — ( 5,801 ) Balance at end of period $ 3,675 $ — $ 3,675 For the Year Ended December 31, 2024 (In Thousands) Net Unrealized Gain/(Loss) on AFS Securities Net Unrealized Gain/(Loss) on Financing Agreements (1) Total AOCI Balance at beginning of period $ 17,698 $ — $ 17,698 OCI before reclassifications 1,764 — 1,764 Amounts reclassified from AOCI ( 9,986 ) — ( 9,986 ) Net OCI during the period (2) ( 8,222 ) — ( 8,222 ) Balance at end of period $ 9,476 $ — $ 9,476 For the Year Ended December 31, 2023 (In Thousands) Net Unrealized Gain/(Loss) on AFS Securities Net Unrealized Gain/(Loss) on Financing Agreements (1) Total AOCI Balance at beginning of period $ 21,341 $ — $ 21,341 OCI before reclassifications ( 2,873 ) — ( 2,873 ) Amounts reclassified from AOCI ( 770 ) — ( 770 ) Net OCI during the period (2) ( 3,643 ) — ( 3,643 ) Balance at end of period $ 17,698 $ — $ 17,698 (1) Net Unrealized Gain/(Loss) on Financing Agreements at Fair Value due to changes in instrument-specific credit risk. (2) For further information regarding changes in OCI, see the Company’s consolidated statements of comprehensive income/(loss). 107 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 11. EPS Calculation The following table presents a reconciliation of the earnings/(loss) and shares used in calculating basic and diluted earnings/(loss) per share for the years ended December 31, 2025, 2024 and 2023: For the Year Ended December 31, (In Thousands, Except Per Share Amounts) 2025 2024 2023 Basic Earnings/(Loss) per Share: Net income/(loss) to common stockholders $ 176,783 $ 119,251 $ 80,164 Dividends declared on preferred stock ( 40,318 ) ( 32,875 ) ( 32,875 ) Dividends, dividend equivalents and undistributed earnings allocated to participating securities ( 781 ) ( 453 ) — Net income/(loss) attributable to common stockholders - basic $ 135,684 $ 85,923 $ 47,289 Basic weighted average common shares outstanding 103,554 103,489 102,215 Basic Earnings/(Loss) per Share $ 1.31 $ 0.83 $ 0.46 Diluted Earnings/(Loss) per Share: Net income/(loss) to common stockholders - basic $ 135,684 $ 85,923 $ 47,289 Dividends, dividend equivalents and undistributed earnings allocated to participating securities — — — Interest expense on Convertible Senior Notes — — — Net income/(loss) attributable to common stockholders - diluted $ 135,684 $ 85,923 $ 47,289 Basic weighted average common shares outstanding 103,554 103,489 102,215 Unvested and vested restricted stock units 427 1,613 1,363 Effect of assumed conversion of Convertible Senior Notes to common shares — — — Diluted weighted average common shares outstanding (1) 103,981 105,102 103,578 Diluted Earnings/(Loss) per Share $ 1.30 $ 0.82 $ 0.46 (1) At December 31, 2025 and 2024, the Company had approximately 1,013,000 and 324,000 equity instruments outstanding that were excluded from the calculation of diluted EPS for the years ended December 31, 2025 and 2024, respectively, as they were determined to be anti-dilutive. These equity instruments reflect RSUs (based on current estimate of expected share settlement amount) with a weighted average grant date fair value of $ 10.32 and $ 10.94 , respectively. These equity instruments may have a dilutive impact on future EPS. During the years ended December 31, 2024 and 2023, the Convertible Senior Notes were determined to be anti-dilutive and were excluded from the calculation of diluted EPS under the “if-converted” method. Under this method, the periodic interest expense for dilutive notes is added back to the numerator and the weighted average number of shares that the notes are entitled to (if converted, regardless of whether the conversion option is in or out of the money) are included in the denominator for the purpose of calculating diluted EPS. 12. Equity Compensation and Other Benefit Plans (a) Equity Compensation Plan In accordance with the terms of the Company’s Equity Plan, which was approved by the Company’s stockholders on June 3, 2025 (and which amended and restated the Company’s Equity Compensation Plan, which had been most recently approved in June 2023), directors, officers and employees of the Company and any of its subsidiaries and other persons expected to provide significant services for the Company and any of its subsidiaries are eligible to receive grants of stock options (“Options”), restricted stock, RSUs, dividend equivalent rights and other stock-based awards under the Equity Plan. Subject to certain exceptions, stock-based awards relating to a maximum of 13.2 million shares of common stock may be granted under the Equity Plan; forfeitures and/or awards that expire unexercised do not count toward this limit. At December 31, 2025, approximately 9.0 million shares of common stock remained available for grant in connection with stock-based awards under the Equity Plan. A participant may generally not receive stock-based awards in excess of 2.0 million shares of common stock in any one year and no award may be granted to any person who, assuming exercise of all Options and payment of all awards held by such person, would own or be deemed to own more than 9.8 % of the outstanding shares of the Company’s common stock. Unless previously terminated by the Board, awards may be granted under the Equity Plan until June 3, 2035. 108 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 Restricted Stock Units Under the terms of the Equity Plan, RSUs are instruments that provide the holder with the right to receive, subject to the satisfaction of conditions set by the Compensation Committee at the time of grant, a payment of a specified value, which may be a share of the Company’s common stock, the fair market value of a share of the Company’s common stock, or such fair market value to the extent in excess of an established base value, on the applicable settlement date. Although the Equity Plan permits the Company to issue RSUs that can settle in cash, all of the Company’s outstanding RSUs as of December 31, 2025 are designated to be settled in shares of the Company’s common stock. All holders of RSUs outstanding at December 31, 2025 may be entitled to receive dividend equivalent payments depending on the terms and conditions of the award either in cash at the time dividends are paid by the Company or at the time of settlement of the RSU award, or for performance-based RSU awards, as a grant of stock at the time such awards are settled. At December 31, 2025 and 2024, the Company had unrecognized compensation expense of $ 7.2 million and $ 6.3 million, respectively, related to RSUs. The unrecognized compensation expense at December 31, 2025 is expected to be recognized over a weighted average period of 1.7 years. The following table presents information with respect to the Company’s RSUs during the years ended December 31, 2025, 2024 and 2023: For the Year Ended December 31, 2025 RSUs With Service Condition Weighted Average Grant Date Fair Value Per Share RSUs With Market and Service Conditions Weighted Average Grant Date Fair Value Per Share Total RSUs Total Weighted Average Grant Date Fair Value Per Share Outstanding at beginning of year: 1,420,910 $ 12.76 2,665,347 $ 11.23 4,086,257 $ 11.76 Granted (1) 604,669 10.09 955,532 10.54 1,560,201 10.36 Settled ( 330,714 ) 15.92 ( 799,069 ) 14.16 ( 1,129,783 ) 14.68 Cancelled/forfeited ( 30,641 ) 10.51 ( 314,336 ) 14.25 ( 344,977 ) 13.92 Outstanding at end of year 1,664,224 $ 11.20 2,507,474 $ 9.66 4,171,698 $ 10.27 RSUs vested but not settled at end of year 1,142,777 $ 11.46 1,664,349 $ 9.55 2,807,126 $ 10.32 RSUs unvested at end of year 521,447 $ 10.64 843,125 $ 9.87 1,364,572 $ 10.17 For the Year Ended December 31, 2024 RSUs With Service Condition Weighted Average Grant Date Fair Value Per Share RSUs With Market and Service Conditions Weighted Average Grant Date Fair Value Per Share Total RSUs Total Weighted Average Grant Date Fair Value Per Share Outstanding at beginning of year: 1,320,059 $ 14.01 1,867,842 $ 11.16 3,187,901 $ 12.34 Granted (2) 573,110 11.17 1,308,727 11.77 1,881,837 11.59 Settled ( 312,808 ) 16.15 — — ( 312,808 ) 16.15 Cancelled/forfeited ( 159,451 ) 10.80 ( 511,222 ) 11.99 ( 670,673 ) 11.71 Outstanding at end of year 1,420,910 $ 12.76 2,665,347 $ 11.23 4,086,257 $ 11.76 RSUs vested but not settled at end of year 957,045 $ 13.75 1,845,176 $ 12.23 2,802,221 $ 12.75 RSUs unvested at end of year 463,865 $ 10.71 820,171 $ 8.99 1,284,036 $ 9.61 109 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 For the Year Ended December 31, 2023 RSUs With Service Condition Weighted Average Grant Date Fair Value Per Share RSUs With Market and Service Conditions Weighted Average Grant Date Fair Value Per Share Total RSUs Total Weighted Average Grant Date Fair Value Per Share Outstanding at beginning of year: 921,308 $ 18.63 1,138,495 $ 15.76 2,059,803 $ 17.04 Granted (3) 610,680 10.32 997,383 7.95 1,608,063 8.85 Settled ( 146,440 ) 27.90 ( 13,639 ) 26.52 ( 160,079 ) 27.78 Cancelled/forfeited ( 65,489 ) 13.44 ( 254,397 ) 18.32 ( 319,886 ) 17.32 Outstanding at end of year 1,320,059 $ 14.01 1,867,842 $ 11.16 3,187,901 $ 12.34 RSUs vested but not settled at end of year 635,595 $ 15.63 560,114 $ 13.61 1,195,709 $ 14.68 RSUs unvested at end of year 684,464 $ 12.52 1,307,728 $ 10.11 1,992,192 $ 10.94 (1) The weighted average grant date fair value of these awards require the Company to estimate certain valuation inputs. In determining the fair value for 1,300,017 of these awards granted in 2025, the Company applied: (i) a weighted average volatility estimate of approximately 34.73 %, which was determined considering historic volatility in the price of the Company’s and its peer group companies common stock over the three-year period prior to the grant date and the implied volatility of certain exchange-traded options on the Company’s and its peer group companies’ common stock at the grant date; and (ii) a weighted average risk-free rate of 4.20 % based on the continuously compounded constant maturity treasury rate corresponding to a maturity commensurate with the expected vesting term of the awards, respectively. The weighted average grant date fair value for the remaining 107,184 awards with a service condition only was estimated based on the closing price of the Company’s common stock at the grant date of $ 9.47 . All of the 955,532 RSUs granted in 2025, the vesting of which is subject to both market and service conditions, are also subject to a one-year post-vesting holding requirement prior to settlement. To account for the estimated loss of value due to this holding restriction, a discount for lack of marketability is applied after the payout value is determined. There is no post vesting holding requirement on the 604,669 RSUs granted in 2025 the vesting of which is subject to a service condition only. (2) The weighted average grant date fair value of these awards require the Company to estimate certain valuation inputs. In determining the fair value for 1,255,486 of these awards granted in 2024, the Company applied: (i) a weighted average volatility estimate of approximately 35.55 %, which was determined considering historic volatility in the price of the Company’s and its peer group companies common stock over the three-year period prior to the grant date and the implied volatility of certain exchange-traded options on the Company’s and its peer group companies’ common stock at the grant date; and (ii) a weighted average risk-free rate of 3.91 % based on the continuously compounded constant maturity treasury rate corresponding to a maturity commensurate with the expected vesting term of the awards, respectively. The weighted average grant date fair value for the remaining 94,333 awards with a service condition only was estimated based on the closing price of the Company’s common stock at the grant date of $ 10.76 . All of the 1,308,727 RSUs granted in 2024, the vesting of which is subject to both market and service conditions, are also subject to a one-year post-vesting holding requirement prior to settlement. To account for the estimated loss of value due to this holding restriction, a discount for lack of marketability is applied after the payout value is determined. There is no post vesting holding requirement on the 573,110 RSUs granted in 2024 the vesting of which is subject to a service condition only. (3) The weighted average grant date fair value of these awards require the Company to estimate certain valuation inputs. In determining the fair value for 1,517,675 of these awards granted in 2023, the Company applied: (i) a weighted average volatility estimate of approximately 56 %, which was determined considering historic volatility in the price of the Company’s and its peer group companies’ common stock over the three-year period prior to the grant date and the implied volatility of certain exchange-traded options on the Company’s and its peer group companies’ common stock at the grant date; and (ii) a weighted average risk-free rate of 4.12 % based on the continuously compounded constant maturity treasury rate corresponding to a maturity commensurate with the expected vesting term of the awards, respectively. The weighted average grant date fair value for the remaining 90,388 awards with a service condition only was estimated based on the closing price of the Company’s common stock at the grant date of $ 11.23 . All of the 997,383 RSUs granted in 2023, the vesting of which is subject to both market and service conditions, are also subject to a one-year post-vesting holding requirement prior to settlement. To account for the estimated loss of value due to this holding restriction, a discount for lack of marketability is applied after the payout value is determined. There is no post vesting holding requirement on the 610,680 RSUs granted in 2023 the vesting of which is subject to a service condition only. Restricted Stock The Company did not grant any shares of restricted common stock during the years ended December 31, 2025, 2024 and 2023. At December 31, 2025, 2024 and 2023, the Company did no t have any unvested shares of restricted common stock outstanding, and no restricted shares vested during the years ended December 31, 2025 and 2024, respectively. Dividend Equivalents A dividend equivalent is a right to receive a distribution equal to the dividend distributions that would be paid on a share of the Company’s common stock. Dividend equivalents may be granted as a separate instrument or may be a right associated with the grant of another award (e.g., an RSU) under the Equity Plan, and they are paid typically in cash or other consideration at such times and in accordance with such rules, as the Compensation Committee of the Board shall determine in its discretion. Dividend 110 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 equivalent payments are generally charged to Stockholders’ Equity when common stock dividends are declared to the extent that such equivalents are expected to vest. The Company made dividend equivalent payments associated with RSU awards of approximately $ 3.9 million, $ 2.4 million, and $ 463,000 during the years ended December 31, 2025, 2024 and 2023, respectively. In addition, no dividend equivalent rights awarded as separate instruments were granted during the years ended December 31, 2025, 2024 and 2023. Expense Recognized for Equity-Based Compensation Instruments The following table presents the Company’s expenses related to its equity-based compensation instruments for the years ended December 31, 2025, 2024 and 2023: For the Year Ended December 31, (In Thousands) 2025 2024 2023 RSUs $ 12,067 $ 13,883 $ 15,035 Total $ 12,067 $ 13,883 $ 15,035 (b) Deferred Compensation Plans The Company administers deferred compensation plans for its senior officers and non-employee directors (collectively, the “Deferred Plans”), pursuant to which participants may elect to defer up to 100 % of certain cash compensation. The Deferred Plans are designed to align participants’ interests with those of the Company’s stockholders. Amounts deferred under the Deferred Plans are considered to be converted into “stock units” of the Company. Stock units do not represent stock of the Company, but rather are a liability of the Company that changes in value as would equivalent shares of the Company’s common stock. Deferred compensation liabilities are settled in cash at the termination of the deferral period, based on the value of the stock units at that time. The Deferred Plans are non-qualified plans under the Employee Retirement Income Security Act of 1974 and, as such, are not funded. Prior to the time that the deferred accounts are settled, participants are unsecured creditors of the Company. The Company’s liability for stock units in the Deferred Plans is based on the market price of the Company’s common stock at the measurement date. The following table presents the Company’s expenses (reversal) related to its Deferred Plans for the years ended December 31, 2025, 2024 and 2023: For the Year Ended December 31, (In Thousands) 2025 2024 2023 Non-employee directors $ 161 $ 39 $ 586 Total $ 161 $ 39 $ 586 The Company distributed cash of approximately $ 273,000 , $ 77,000 , and $ 374,000 to the participants of the Deferred Plans during the years ended December 31, 2025, 2024 and 2023, respectively. The following table presents the aggregate amount of income deferred by participants of the Deferred Plans through December 31, 2025 and 2024 that had not been distributed and the Company’s associated liability for such deferrals at December 31, 2025 and 2024: December 31, 2025 December 31, 2024 (In Thousands) Undistributed Income Deferred (1) Liability Under Deferred Plans Undistributed Income Deferred (1) Liability Under Deferred Plans Non-employee directors $ 2,742 $ 2,738 $ 2,734 $ 2,561 Total $ 2,742 $ 2,738 $ 2,734 $ 2,561 (1) Represents the cumulative amounts that were deferred by participants through December 31, 2025 and 2024, which had not been distributed through such respective date. 111 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 (c) Savings Plan The Company sponsors a tax-qualified employee savings plan (the “Savings Plan”) in accordance with Section 401(k) of the Code. Subject to certain restrictions, all of the Company’s employees are eligible to make tax-deferred contributions to the Savings Plan subject to limitations under applicable law. Participants’ accounts are self-directed and the Company bears the costs of administering the Savings Plan. The Company matches 100 % of the first 3 % of eligible compensation deferred by employees and 50 % of the next 2 %, subject to a maximum as provided by the Code. The Company has elected to operate the Savings Plan under the applicable safe harbor provisions of the Code, whereby among other things, the Company must make contributions for all participating employees and all matches contributed by the Company immediately vest 100 %. For the years ended December 31, 2025, 2024 and 2023, the Company recognized expenses for matching contributions of $ 1.7 million, $ 1.4 million and $ 1.3 million, respectively. 13. Fair Value of Financial Instruments GAAP requires the categorization of fair value measurements into three broad levels that form a hierarchy. A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The three levels of valuation hierarchy are defined as follows: Level 1 — Inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2 — Inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. Level 3 — Inputs to the valuation methodology are unobservable and significant to the fair value measurement. The following describes the valuation methodologies used for the Company’s financial instruments measured at fair value on a recurring basis, as well as the general classification of such instruments pursuant to the valuation hierarchy. Residential Whole Loans, at Fair Value The Company determines the fair value of its residential whole loans held at fair value after considering valuations obtained from third parties that specialize in providing valuations of residential mortgage loans. The valuation approach applied generally depends on whether the loan is considered performing or non-performing at the date the valuation is performed. For performing loans, estimates of fair value are derived using a discounted cash flow approach, where estimates of cash flows are determined from the scheduled payments, adjusted using forecasted prepayment, default and loss given default rates. For non-performing loans, asset liquidation cash flows are derived based on the estimated time to liquidate the loan, the estimated value of the collateral, expected costs and estimated home price levels. Estimated cash flows for both performing and non-performing loans are discounted at yields considered appropriate to arrive at a reasonable exit price for the asset. Indications of loan value such as actual trades, bids, offers and generic market color may be used in determining the appropriate discount yield. The Company’s residential whole loans held at fair value are classified as Level 3 in the fair value hierarchy; however, the Company determined that the market inputs used in valuing its Agency eligible investor loans were sufficiently observable to be classified as Level 2. 112 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 Securities, at Fair Value Residential Mortgage Securities In determining the fair value of the Company’s residential mortgage securities, management considers a number of observable market data points, including prices obtained from pricing services and brokers as well as dialogue with market participants. Valuations of TBA securities positions are based on executed levels for positions entered into and subsequently rolled forward, as well as prices obtained from pricing services for outstanding positions at each reporting date. These valuations are assessed for reasonableness by considering market TBA levels observed via Bloomberg for the same coupon and term to maturity. In valuing Non-Agency MBS, the Company understands that pricing services use observable inputs that include, in addition to trading activity observed in the marketplace, loan delinquency data, credit enhancement levels and vintage, which are taken into account to assign pricing factors such as spread and prepayment assumptions. The Company collects and considers current market intelligence on all major markets, including benchmark security evaluations and bid-lists from various sources, when available. The Company’s residential mortgage securities are valued using various market data points as described above, which management considers directly or indirectly observable parameters. Accordingly, these securities are classified as Level 2 in the fair value hierarchy. Term Notes Backed by MSR Collateral The Company’s valuation process for term notes backed by MSR collateral is similar to that used for residential mortgage securities and considers a number of observable market data points, including prices obtained from pricing services, brokers and repurchase agreement counterparties, dialogue with market participants, as well as management’s observations of market activity. Other factors taken into consideration include estimated changes in fair value of the related underlying MSR collateral and, as applicable, the financial performance of the ultimate parent or sponsoring entity of the issuer, which has provided a guarantee that is intended to provide for payment of interest and principal to the holders of the term notes if cash flows generated by the related underlying MSR collateral are insufficient. Based on its evaluation of the observability of the data used in its fair value estimation process, these assets are classified as Level 2 in the fair value hierarchy. Financing Agreements, at Fair Value Agreements with mark-to-market collateral provisions These agreements are secured and subject to margin calls and their base interest rates reset frequently to market based rates. As a result, no credit valuation adjustment is required, and the primary factor in determining their fair value is the credit spread paid over the base rate, which is a non-observable input as it is determined based on negotiations with the counterparty. The Company’s financing agreements with mark-to-market collateral provisions held at fair value are classified as Level 2 in the fair value hierarchy if the credit spreads used to price the instrument reset frequently, which is typically the case with shorter term repurchase agreement contracts collateralized by securities. Financing agreements with mark-to-market collateral provisions that are typically longer term and are collateralized by residential whole loans where the credit spread paid over the base rate on the instrument is not reset frequently are classified as Level 3 in the fair value hierarchy. Agreements with non-mark-to-market collateral provisions These agreements are secured, but not subject to margin calls based on changes in the fair value of the financed residential whole loans. Such agreements may experience changes in advance rates or collateral eligibility as a result of factors such as changes in the delinquency status of the financed residential whole loans. As a result, a credit valuation adjustment would only be required if there were a significant decrease in collateral value, and the primary factor in determining their fair value is the credit spread paid over the base rate, which is a non-observable input as it is determined based on negotiations with the counterparty. The Company’s financing agreements with non-mark-to-market collateral provisions held at fair value are classified as Level 3 in the fair value hierarchy. Securitized Debt In determining the fair value of securitized debt, management considers a number of observable market data points, including prices obtained from pricing services and brokers as well as dialogue with market participants, consistent with the valuation methodology for residential mortgage securities. Accordingly, the Company’s securitized debt is classified as Level 2 in the fair value hierarchy. 113 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 Swaps Variation margin payments on the Company’s Swaps are treated as a legal settlement of the exposure under the related Swap contract, the effect of which reduces what would have otherwise been reported as the fair value of the Swap, generally to zero. The Company receives prices from pricing services to validate the fair value of the Swaps. Changes to the valuation methodologies used with respect to the Company’s financial instruments are reviewed by management to ensure any such changes result in appropriate exit price valuations. The Company will refine its valuation methodologies as markets and products develop and pricing methodologies evolve. The methods described above may produce fair value estimates that may not be indicative of net realizable value or reflective of future fair values. Furthermore, while the Company believes its valuation methods are appropriate and consistent with those used by market participants, the use of different methodologies, or assumptions, to determine the fair value of certain financial instruments could result in a different estimate of fair value at the reporting date. The Company uses inputs that are current as of the measurement date, which may include periods of market dislocation, during which price transparency may be reduced. The Company reviews the classification of its financial instruments within the fair value hierarchy on a quarterly basis, and management may conclude that its financial instruments should be reclassified to a different level in the future. The following tables present the Company’s financial instruments carried at fair value on a recurring basis as of December 31, 2025 and 2024, on the consolidated balance sheets by the valuation hierarchy, as previously described: Fair Value at December 31, 2025 (In Thousands) Level 1 Level 2 Level 3 Total Assets: Residential whole loans, at fair value $ — $ 51,022 $ 7,665,985 $ 7,717,007 Securities, at fair value — 3,360,280 — 3,360,280 Total assets carried at fair value $ — $ 3,411,302 $ 7,665,985 $ 11,077,287 Liabilities: Agreements with non-mark-to-market collateral provisions $ — $ — $ 48,245 $ 48,245 Agreements with mark-to-market collateral provisions — — 61,068 61,068 Securitized debt — 5,846,744 — 5,846,744 Total liabilities carried at fair value $ — $ 5,846,744 $ 109,313 $ 5,956,057 Fair Value at December 31, 2024 (In Thousands) Level 1 Level 2 Level 3 Total Assets: Residential whole loans, at fair value $ — $ 52,073 $ 7,459,137 $ 7,511,210 Securities, at fair value — 1,537,513 — 1,537,513 Total assets carried at fair value $ — $ 1,589,586 $ 7,459,137 $ 9,048,723 Liabilities: Agreements with non-mark-to-market collateral provisions $ — $ — $ 284,843 $ 284,843 Agreements with mark-to-market collateral provisions — — 19,782 19,782 Securitized debt — 5,211,380 — 5,211,380 Total liabilities carried at fair value $ — $ 5,211,380 $ 304,625 $ 5,516,005 114 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 Changes in Level 3 Assets and Liabilities Measured at Fair Value on a Recurring Basis The following table presents additional information for the years ended December 31, 2025 and 2024 about the Company’s Residential whole loans, at fair value, which are classified as Level 3 and measured at fair value on a recurring basis: Residential Whole Loans, at Fair Value For the Year Ended December 31, (In Thousands) 2025 2024 Balance at beginning of period $ 7,459,137 $ 7,455,729 Purchases and originations 2,336,919 2,077,564 Draws 351,757 556,943 Changes in fair value recorded in Net gain/(loss) on residential whole loans measured at fair value through earnings 150,122 96,353 Repayments ( 2,251,708 ) ( 1,962,039 ) Loan sales and repurchases ( 285,368 ) ( 683,407 ) Transfer to REO ( 94,874 ) ( 82,006 ) Balance at end of period $ 7,665,985 $ 7,459,137 The following table presents additional information for the years ended December 31, 2025 and 2024 about the Company’s financing agreements with non-mark-to-market collateral provisions, which are classified as Level 3 and measured at fair value on a recurring basis: Agreements with Non-mark-to-market Collateral Provisions Year Ended December 31, (In Thousands) 2025 2024 Balance at beginning of period $ 284,843 $ 469,424 Issuances 25,612 216,189 Payment of principal ( 262,210 ) ( 400,770 ) Changes in unrealized losses — — Balance at end of period $ 48,245 $ 284,843 The following table presents additional information for the years ended December 31, 2025 and 2024 about the Company’s financing agreements with mark-to-market collateral provisions, which are classified as Level 3 and measured at fair value on a recurring basis: Agreements with Mark-to-market Collateral Provisions Year Ended December 31, (In Thousands) 2025 2024 Balance at beginning of period $ 19,782 $ 178,864 Issuances 229,522 127,422 Payment of principal ( 188,236 ) ( 286,504 ) Changes in unrealized losses — — Balance at end of period $ 61,068 $ 19,782 115 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 Fair Value Methodology for Level 3 Financial Instruments Residential Whole Loans, at Fair Value The following tables present a summary of quantitative information about the significant unobservable inputs used in the fair value measurement of the Company’s residential whole loans held at fair value for which it has utilized Level 3 inputs to determine fair value as of December 31, 2025 and 2024: December 31, 2025 Fair Value (1) Valuation Technique Unobservable Input Weighted Average (2) Range Min Max $ 7,196,955 Discounted cash flow Discount rate 6.5 % 5.5 % 20.0 % Prepayment rate 17.1 % — % 50.5 % Default rate 1.6 % — % 68.2 % Loss severity 11.4 % — % 100.0 % $ 330,295 Liquidation model Discount rate 9.1 % 8.0 % 20.0 % Annual change in home prices 1.9 % ( 0.9 ) % 8.7 % Liquidation timeline (in years) 1.7 0.1 4.5 Current value of underlying properties (3) $ 748 $ 19 $ 11,400 $ 7,527,250 (1) Excludes approximately $ 138.7 million of Residential whole loans, at fair value, with a UPB of $ 170.8 million, which were marked-to-market, but not based on a model, at December 31, 2025. (2) Amounts are weighted based on the fair value of the underlying loan. (3) Amounts represent simple average values of the properties underlying residential whole loans held at fair value. December 31, 2024 Fair Value (1) Valuation Technique Unobservable Input Weighted Average (2) Range Min Max $ 7,070,535 Discounted cash flow Discount rate 7.6 % 6.2 % 20.0 % Prepayment rate 13.7 % — % 58.3 % Default rate 1.8 % — % 54.3 % Loss severity 12.3 % — % 100.0 % $ 343,683 Liquidation model Discount rate 8.8 % 8.0 % 20.0 % Annual change in home prices 3.2 % — % 9.7 % Liquidation timeline (in years) 1.7 0.1 4.5 Current value of underlying properties (3) $ 618 $ 21 $ 8,500 $ 7,414,218 (1) Excludes approximately $ 44.9 million of Residential whole loans, at fair value, with a UPB of $ 78.2 million, which were marked-to-market, but not based on a model, at December 31, 2024. (2) Amounts are weighted based on the fair value of the underlying loan. (3) Amounts represent simple average values of the properties underlying residential whole loans held at fair value. Changes in market conditions, as well as changes in the assumptions or methodology used to determine fair value, could result in a significant increase or decrease in the fair value of residential whole loans. Loans valued using a discounted cash flow model are most sensitive to changes in the discount rate assumption, while loans valued using the liquidation model technique are most sensitive to changes in the current value of the underlying properties and the liquidation timeline. Increases in discount rates, default rates, loss severities, or liquidation timelines, either in isolation or collectively, would generally result in a lower fair value measurement, whereas increases in the current or expected value of the underlying properties, in isolation, would result in a higher fair value measurement. In practice, changes in valuation assumptions may not occur in isolation and the changes in any particular assumption may result in changes in other assumptions, which could offset or amplify the impact on the overall valuation. 116 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 The following table presents the carrying values and estimated fair values of the Company’s financial instruments at December 31, 2025 and 2024: (In Thousands) December 31, 2025 December 31, 2025 December 31, 2024 Level in Fair Value Hierarchy Carrying Value Estimated Fair Value Carrying Value Estimated Fair Value Financial Assets: Residential whole loans 3 $ 8,759,332 $ 8,769,457 $ 8,759,151 $ 8,743,881 Residential whole loans 2 51,022 51,022 52,073 52,073 Securities, at fair value 2 3,360,280 3,360,280 1,537,513 1,537,513 Cash and cash equivalents 1 213,211 213,211 338,931 338,931 Restricted cash 1 173,457 173,457 262,381 262,381 Financial Liabilities (1) : Financing agreements with non-mark-to-market collateral provisions 3 82,016 82,019 576,774 577,231 Financing agreements with mark-to-market collateral provisions 3 1,331,968 1,332,593 1,321,041 1,321,584 Financing agreements with mark-to-market collateral provisions 2 2,980,762 2,980,762 1,279,007 1,279,007 Securitized debt 2 6,336,462 6,290,788 5,794,977 5,724,702 Other secured financing 3 23,908 23,908 — — 8.875 % Senior Notes 2 112,041 114,616 111,270 115,720 9.00 % Senior Notes 2 72,858 75,338 72,390 75,218 (1) Carrying value of securitized debt, 8.875 % Senior Notes, 9.00 % Senior Notes, and certain repurchase agreements is net of associated debt issuance costs. Other Assets Measured at Fair Value on a Nonrecurring Basis The Company holds REO and Commercial REO (see Note 5) at the lower of the current carrying amount or fair value less estimated selling costs. The Company classifies fair value measurements of REO as Level 3 in the fair value hierarchy. REO - During the years ended December 31, 2025 and 2024, the Company recorded REO with an aggregate estimated fair value, less estimated cost to sell, of $ 107.1 million and $ 103.7 million, respectively, at the time of foreclosure. During the year ended December 31, 2025, the Company reclassified three REO properties originally classified as held for investment to held for sale status and marked them down to their estimated fair value, less estimated cost to sell, of $ 10.4 million. Commercial REO - During the year ended December 31, 2025, the Company did not record any new Commercial REO, but recorded valuation adjustments on existing Commercial REO totaling $( 1.5 ) million. During the year ended December 31, 2024, the Company recognized at fair value two properties considered Commercial REO at $ 28.4 million and $ 40.0 million, of which the Company’s 75 % and 49 % interests were $ 10.3 million and $ 4.9 million (net of related third-party financing), respectively. During the year ended December 31, 2024, the Company recorded valuation adjustments on Commercial REO totaling $( 0.7 ) million. The Company determined to sell certain residential whole loans in the fourth quarter of 2023. At the time this determination was made, certain of the loans were marked to fair value as their fair value at that time was lower than their carrying value. The aggregate value of these loans at the time of determination was $ 13.6 million and a loss of $ 1.2 million was recorded. These loans were classified as Level 3 in the fair value hierarchy. 117 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 14. Use of Special Purpose Entities and Variable Interest Entities A Special Purpose Entity (“SPE”) is an entity designed to fulfill a specific limited need of the company that organized it. SPEs are often used to facilitate transactions that involve securitizing financial assets or re-securitizing previously securitized financial assets. The objective of such transactions may include obtaining non-recourse financing, obtaining liquidity or refinancing the underlying financial assets on improved terms. Securitization involves transferring assets to a SPE to convert all or a portion of those assets into cash before they would have been realized in the normal course of business, through the SPE’s issuance of debt or equity instruments. Investors in a SPE usually have recourse only to the assets in the SPE and, depending on the overall structure of the transaction, may benefit from various forms of credit enhancement such as over-collateralization in the form of excess assets in the SPE, priority with respect to receipt of cash flows relative to holders of other debt or equity instruments issued by the SPE, or a line of credit or other form of liquidity agreement that is designed with the objective of ensuring that investors receive principal and/or interest cash flow on the investment in accordance with the terms of their investment agreement. The Company has entered into several financing transactions that resulted in the Company consolidating as VIEs the SPEs that were created to facilitate these transactions. See Note 2(q) for a discussion of the accounting policies applied to the consolidation of VIEs and transfers of financial assets in connection with financing transactions. The Company has engaged in loan securitizations primarily for the purpose of obtaining improved overall financing terms as well as non-recourse financing on a portion of its residential whole loan portfolio. Notwithstanding the Company’s participation in these transactions, the risks facing the Company are largely unchanged as the Company remains economically exposed to the first loss position on the underlying assets transferred to the VIEs. Loan Securitization Transactions The following table summarizes the key details of the Company’s consolidated loan securitization transactions currently outstanding as of December 31, 2025 and 2024: (Dollars in Thousands) December 31, 2025 December 31, 2024 Aggregate unpaid principal balance of residential whole loans sold $ 11,489,998 $ 9,924,643 Face amount of Senior Bonds issued by the VIE and purchased by third-party investors $ 10,142,071 $ 8,655,017 Outstanding amount of Senior Bonds, at carrying value (1) $ 489,718 $ 583,597 Outstanding amount of Senior Bonds, at fair value $ 5,846,744 $ 5,211,380 Outstanding amount of Senior Bonds, total $ 6,336,462 $ 5,794,977 Weighted average rate for Senior Bonds issued (2) (3) 5.07 % 5.02 % Weighted average contractual maturity of Senior Bonds (3) 37 years 36 years Face amount of Senior Support Certificates received by the Company (4) $ 1,307,153 $ 1,222,029 Cash received $ 10,061,131 $ 8,574,069 (1) Net of $ 0.9 million and $ 1.1 million of deferred financing costs at December 31, 2025 and 2024, respectively. (2) At December 31, 2025, 99.6 % and 0.4 % of Senior Bonds had a fixed and variable rate, respectively. At December 31, 2024, all Senior Bonds had a fixed rate. (3) At December 31, 2025 and 2024, $ 4.7 billion and $ 4.2 billion, respectively, of Senior Bonds sold in securitization transactions contained a contractual coupon step-up feature whereby the coupon increases by either 100 , 150 , or 300 basis points at defined dates ranging from 30 months, up to 48 months from issuance if the bond is not redeemed before such date. (4) Provides credit support to the Senior Bonds sold to third-party investors in the securitization transactions. During the years ended December 31, 2025 and 2024, the Company issued Senior Bonds with a current face of $ 1.7 billion and $ 2.1 billion to third-party investors for proceeds of $ 1.7 billion and $ 2.1 billion, respectively, before offering costs and accrued interest. The Senior Bonds issued by the Company during the years ended December 31, 2025 and 2024 are included in Financing agreements on the Company’s consolidated balance sheets (see Note 6). During the three months ended June 30, 2024, the Company liquidated one SPE (which had been formed in 2021) and repaid the remaining $ 68.1 million of outstanding Senior Bonds issued by such SPE. During the three months ended September 30, 2024, the Company redeemed one SPE (which had been formed in 2022) and repaid the remaining $ 176.3 million of outstanding Senior Bonds issued by such SPE. As of December 31, 2025 and 2024, as a result of the transactions described above, securitized loans of approximately $ 7.6 billion and $ 6.9 billion are included in Residential whole loans and REO with a carrying value of approximately $ 52.4 million and $ 26.9 million are included in Other assets on the Company’s consolidated balance sheets, respectively. As of December 31, 2025 118 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 and 2024, the aggregate carrying value of Senior Bonds issued by consolidated VIEs was $ 6.3 billion and $ 5.8 billion, respectively. These Senior Bonds are disclosed as Securitized debt and are included in Financing agreements on the Company’s consolidated balance sheets. The holders of the securitized debt have no recourse to the general credit of the Company, but the Company does have the obligation, under certain circumstances, to repurchase assets from the VIE upon the breach of certain representations and warranties with respect to the residential whole loans sold to the VIE. In the absence of such a breach, the Company has no obligation to provide any other explicit or implicit support to any VIE. The Company concluded that the entities created to facilitate the loan securitization transactions are VIEs. The Company completed an analysis of whether each VIE created to facilitate the securitization transactions should be consolidated by the Company, based on consideration of its involvement in each VIE, including the design and purpose of the SPE, and whether its involvement reflected a controlling financial interest that resulted in the Company being deemed the primary beneficiary of each VIE. In determining whether the Company would be considered the primary beneficiary, the following factors were assessed: • whether the Company has both the power to direct the activities that most significantly impact the economic performance of the VIE; and • whether the Company has a right to receive benefits or absorb losses of the entity that could be potentially significant to the VIE. Based on its evaluation of the factors discussed above, including maintaining certain rights in each entity including rights to direct loss mitigation activities and its involvement in the purpose and design of the entity, the Company determined that it was required to consolidate each VIE created to facilitate the loan securitization transactions. The Company also invests in securities issued by SPEs that may be VIEs. The Company is not the primary beneficiary of these SPEs, because it does not have the power to direct the activities that most significantly impact their economic performance, and therefore does not consolidate them. For these entities, the Company’s maximum exposure to loss is the amortized cost basis of the securities it owns, and it does not provide any liquidity arrangements, guarantees or other commitments to these entities. For more information on the Company’s investments in securities, see Note 4. The Company also has interests in certain entities which are deemed to be VIEs that hold commercial property (see Note 5). The Company’s maximum exposure to loss with respect to these entities is their carrying value, which aggregated $ 19.9 million at December 31, 2025. Residential Whole Loans and REO (including Residential Whole Loans and REO transferred to consolidated VIEs) Included on the Company’s consolidated balance sheets as of December 31, 2025 and 2024 are a total of $ 8.8 billion and $ 8.8 billion, respectively, of residential whole loans. These assets, excluding certain loans originated and held by Lima One, and certain of the Company’s REO assets, are directly owned by certain trusts established by the Company to acquire the loans and entities established in connection with the Company’s loan securitization transactions. The Company has assessed that these entities are required to be consolidated (see Notes 3 and 5(a)). 15. Segment Reporting At December 31, 2025, the Company’s reportable segments include (i) mortgage-related assets and (ii) Lima One. The Corporate column in the table below primarily consists of corporate cash and related interest income, investments in loan originators and related economics, general and administrative expenses not directly attributable to Lima One, interest expense on unsecured senior notes (see Note 6), securitization issuance costs, and preferred stock dividends. The Company’s segments are managed by its “chief operating decision maker” or “CODM” as defined under GAAP; the Company’s CODM is its Chief Executive Officer. The CODM utilizes the segment reporting as part of their analysis of relative segment performance in deciding where to focus resources to enhance the Company’s future performance. 119 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 The following tables summarize segment financial information, which in total reconciles to the same data for the Company as a whole: (In Thousands) Mortgage-Related Assets Lima One Corporate Total Year Ended December 31, 2025 Interest Income $ 507,363 $ 227,963 $ 9,738 $ 745,064 Interest Expense 351,034 144,751 18,195 513,980 Net Interest Income/(Expense) $ 156,329 $ 83,212 $ ( 8,457 ) $ 231,084 Reversal/(Provision) for Credit Losses on Residential Whole Loans ( 936 ) — — ( 936 ) Reversal/(Provision) for Credit Losses on Other Assets — — — — Net Interest Income/(Expense) after Reversal/(Provision) for Credit Losses $ 155,393 $ 83,212 $ ( 8,457 ) $ 230,148 Net gain/(loss) on residential whole loans measured at fair value through earnings $ 124,971 $ 8,718 $ — $ 133,689 Impairment and other net gain/(loss) on securities and other portfolio investments 58,132 22 3,389 61,543 Net gain/(loss) on real estate owned 1,181 ( 7,941 ) — ( 6,760 ) Net gain/(loss) on derivatives used for risk management purposes ( 28,756 ) ( 6,788 ) — ( 35,544 ) Net gain/(loss) on securitized debt measured at fair value through earnings ( 51,199 ) ( 4,017 ) — ( 55,216 ) Lima One mortgage banking income — 22,848 — 22,848 Net realized gain/(loss) on residential whole loans held at carrying value ( 882 ) — — ( 882 ) Other, net ( 4,053 ) ( 16,723 ) 2,053 ( 18,723 ) Other Income/(Loss), net $ 99,394 $ ( 3,881 ) $ 5,442 $ 100,955 Compensation and benefits $ — $ 37,846 $ 39,823 $ 77,669 Other general and administrative expense ( 22 ) 19,010 22,752 41,740 Loan servicing, financing and other related costs 17,275 6,272 9,899 33,446 Amortization of intangible assets — 2,200 — 2,200 Income/(loss) before income taxes $ 237,534 $ 14,003 $ ( 75,489 ) $ 176,048 Provision for/(benefit from) income taxes $ — $ — $ ( 735 ) $ ( 735 ) Net Income/(Loss) $ 237,534 $ 14,003 $ ( 74,754 ) $ 176,783 Less Preferred Stock Dividend Requirement $ — $ — $ 40,318 $ 40,318 Net Income/(Loss) Available to Common Stock and Participating Securities $ 237,534 $ 14,003 $ ( 115,072 ) $ 136,465 120 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 (Dollars in Thousands) Mortgage-Related Assets Lima One Corporate Total Year Ended December 31, 2024 Interest Income $ 404,233 $ 306,191 $ 13,541 $ 723,965 Interest Expense 285,329 214,697 21,208 521,234 Net Interest Income/(Expense) $ 118,904 $ 91,494 $ ( 7,667 ) $ 202,731 Reversal/(Provision) for Credit Losses on Residential Whole Loans $ 3,084 $ — $ — $ 3,084 Reversal/(Provision) for Credit Losses on Other Assets ( 1,135 ) — — ( 1,135 ) Net Interest Income/(Expense) after Reversal/(Provision) for Credit Losses $ 120,853 $ 91,494 $ ( 7,667 ) $ 204,680 Net gain/(loss) on residential whole loans measured at fair value through earnings $ 55,428 $ ( 9,434 ) $ — $ 45,994 Impairment and other net gain/(loss) on securities and other portfolio investments ( 7,976 ) 94 ( 2,987 ) ( 10,869 ) Net gain/(loss) on real estate owned 4,876 ( 1,740 ) — 3,136 Net gain/(loss) on derivatives used for risk management purposes 58,238 20,265 — 78,503 Net gain/(loss) on securitized debt measured at fair value through earnings ( 39,238 ) ( 25,575 ) — ( 64,813 ) Lima One mortgage banking income — 32,944 — 32,944 Net realized gain/(loss) on residential whole loans held at carrying value 418 — — 418 Other, net 1,326 ( 2,997 ) 1,786 115 Other Income/(Loss), net $ 73,072 $ 13,557 $ ( 1,201 ) $ 85,428 Compensation and benefits $ — $ 42,885 $ 44,769 $ 87,654 Other general and administrative expense 190 19,977 24,087 44,254 Loan servicing, financing and other related costs 18,873 2,857 13,576 35,306 Amortization of intangible assets — 3,200 — 3,200 Income/(loss) before income taxes $ 174,862 $ 36,132 $ ( 91,300 ) $ 119,694 Provision for/(benefit from) income taxes $ — $ — $ 443 $ 443 Net Income/(Loss) $ 174,862 $ 36,132 $ ( 91,743 ) $ 119,251 Less Preferred Stock Dividend Requirement $ — $ — $ 32,875 $ 32,875 Net Income/(Loss) Available to Common Stock and Participating Securities $ 174,862 $ 36,132 $ ( 124,618 ) $ 86,376 121 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 (Dollars in Thousands) Mortgage-Related Assets Lima One Corporate Total Year Ended December 31, 2023 Interest Income $ 364,081 $ 228,825 $ 12,691 $ 605,597 Interest Expense 242,930 170,587 15,601 429,118 Net Interest Income/(Expense) $ 121,151 $ 58,238 $ ( 2,910 ) $ 176,479 Reversal/(Provision) for Credit Losses on Residential Whole Loans 8,539 314 — 8,853 Reversal/(Provision) for Credit Losses on Other Assets — — — — Net Interest Income/(Expense) after Reversal/(Provision) for Credit Losses $ 129,690 $ 58,552 $ ( 2,910 ) $ 185,332 Net gain/(loss) on residential whole loans measured at fair value through earnings $ 69,486 $ 20,364 $ — $ 89,850 Impairment and other net gain/(loss) on securities and other portfolio investments 8,073 — ( 1,848 ) 6,225 Net gain/(loss) on real estate owned 9,274 118 — 9,392 Net gain/(loss) on derivatives used for risk management purposes 839 2,922 — 3,761 Net gain/(loss) on securitized debt measured at fair value through earnings ( 66,969 ) ( 32,620 ) — ( 99,589 ) Lima One mortgage banking income — 43,384 — 43,384 Net realized gain/(loss) on residential whole loans held at carrying value ( 1,240 ) — — ( 1,240 ) Other, net 7,960 2,284 1,087 11,331 Other Income/(Loss), net $ 27,423 $ 36,452 $ ( 761 ) $ 63,114 Compensation and benefits $ — $ 44,827 $ 40,972 $ 85,799 Other general and administrative expense 214 17,537 26,118 43,869 Loan servicing, financing and other related costs 20,100 1,515 12,521 34,136 Amortization of intangible assets — 4,200 — 4,200 Income/(loss) before income taxes $ 136,799 $ 26,925 $ ( 83,282 ) $ 80,442 Provision for/(benefit from) income taxes — — 278 278 Net Income/(Loss) $ 136,799 $ 26,925 $ ( 83,560 ) $ 80,164 Less Preferred Stock Dividend Requirement $ — $ — $ 32,875 $ 32,875 Net Income/(Loss) Available to Common Stock and Participating Securities $ 136,799 $ 26,925 $ ( 116,435 ) $ 47,289 (Dollars in Thousands) Mortgage-Related Assets Lima One Corporate Total December 31, 2025 Total Assets $ 10,128,088 $ 2,632,740 $ 285,621 $ 13,046,449 December 31, 2024 Total Assets $ 7,395,925 $ 3,632,472 $ 381,207 $ 11,409,604 Lima One Segment The Lima One segment includes the stand-alone mortgage origination and servicing business of Lima One, including related goodwill, intangible assets, and direct expenses, plus Lima One-related residential whole loans and REO (defined as both those owned by Lima One on the acquisition date and those originated by Lima One since the acquisition date) and the economics related thereto (including any related taxes and the economics of associated financing and hedging instruments), all as recorded under GAAP. Associated financing economics are equal to the results of direct financings of Lima One-related residential whole loans and REO plus allocations of the results of financings which include Lima One related residential whole loans and REO as part of their collateral, based on the relative carrying values of the financed assets. Associated hedging economics are equal to allocations of the 122 Table of Contents MFA FINANCIAL, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025 Company’s overall hedging results based on the relative estimated duration of each asset class hedged and the relative fair values of assets within each asset class. Mortgage-Related Assets Segment This segment is comprised of the remainder of the Company’s investments (including any related taxes and the economics of associated financing and hedging instruments). 16. Subsequent Events In February 2026, the Company entered into an agreement with the landlord for the current corporate headquarters to accelerate the contractual expiration of its lease to November 30, 2026. In addition, the Company has reached an agreement in principle to enter into a ten-year lease for new corporate headquarters space located in New York City. While the Company is still evaluating the financial statement impact of these agreements, the Company currently expects to modify the right-of-use assets and lease obligations, recognize a gain of approximately $ 1 - 2 million, and recognize accelerated depreciation expense in 2026 related to the remaining undepreciated tenant improvements at the current corporate headquarters totaling approximately $ 7 million. Additionally, the Company expects to recognize a new right-of-use asset and lease liability and recognize lower rental expense at the expected new corporate headquarters. The Company expects that in the aggregate, once complete, these actions will result in run-rate annual expense savings of approximately $ 4 million per year over the next ten years . 123 Table of Contents Schedule IV - Mortgage Loans on Real Estate December 31, 2025 Asset Type Number Interest Rate Maturity Date Range Balance Sheet Reported Amount Principal Amount of Loans Subject to Delinquent Principal or Interest (Dollars in Thousands) Residential Whole Loans Original loan balance $ 0 - $ 149,999 7,378 0.00 % - 18.00 % 7/26/2016-6/1/2065 $ 739,276 $ 57,152 Original loan balance $ 150,000 - $ 299,999 7,449 1.70 % - 14.63 % 1/1/2017-6/1/2065 1,502,027 87,766 Original loan balance $ 300,000 - $ 449,999 3,564 0.00 % - 13.40 % 3/1/2023-9/1/2071 1,217,449 61,418 Original loan balance greater than $ 449,999 5,374 2.00 % - 13.90 % 11/30/2019-12/1/2065 5,361,308 298,934 23,765 $ 8,820,060 (1)(2) $ 505,270 (1) Excludes an allowance for loan losses of $ 9.7 million at December 31, 2025. (2) The federal income tax basis is approximately $ 2.3 billion. Reconciliation of Balance Sheet Reported Amounts of Mortgage Loans on Real Estate The following table summarizes the changes in the carrying amounts of residential whole loans during the year ended December 31, 2025: For the Year Ended December 31, 2025 (In Thousands) Residential Whole Loans Beginning Balance $ 8,811,224 Additions during period: Purchases and originations $ 2,688,676 Reversal of provision for loan loss 959 Changes in fair value recorded in gain/(loss) on loans recorded at fair value 153,592 Deductions during period: Repayments $ ( 2,440,525 ) Loan sales and repurchases ( 287,982 ) Premium amortization/discount accretion, net ( 7,441 ) Impairment on carrying value loans — Transfer to REO ( 108,149 ) Ending Balance $ 8,810,354 124 Table of Contents Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure. None.