Velocity Financial, Inc. 8-K

What Happened
Velocity Financial, Inc. (the Company) reported on January 30, 2026 that its wholly‑owned subsidiary, Velocity Commercial Capital, LLC (the Issuer), completed the issuance and sale of $500 million aggregate principal amount of 9.375% Senior Notes due February 15, 2031. The notes were issued under an Indenture with U.S. Bank Trust Company, N.A. as trustee and are fully and unconditionally guaranteed on a senior unsecured basis by Velocity Financial. The offering was made to qualified institutional buyers under Rule 144A and to non‑U.S. investors under Regulation S and the notes are not registered under the Securities Act.

Key Details

• Principal amount: $500,000,000; coupon: 9.375% per year, interest payable semi‑annually on February 15 and August 15, beginning August 15, 2026.
• Maturity: February 15, 2031.
• Redemption: On or after Feb 15, 2028, callable at set prices (2028: 104.668%, 2029: 102.334%, 2030+: 100%). Prior to Feb 15, 2028, callable at par plus an Applicable Premium; up to 40% may be redeemed before Feb 15, 2028 with certain equity proceeds at 109.375%.
• Change of control: required offer to repurchase at 101% of principal plus accrued interest upon certain change‑of‑control events.
• Guarantees & covenants: Guaranteed by Velocity (not by its subsidiaries at closing); Indenture contains customary covenants limiting additional indebtedness, liens, dividends/restricted payments, investments, certain dispositions and affiliate transactions.
• Offering mechanics: Sold in a private placement (Rule 144A/Reg S); securities are restricted and not registered for public resale in the U.S.

Why It Matters
This transaction raises $500 million of long‑term debt for the company, which will increase outstanding leverage and create ongoing interest obligations (paid semi‑annually at a 9.375% rate). The indenture’s covenants may restrict the company’s ability to take on additional debt, pay dividends, make certain investments or complete certain transactions without meeting covenant tests. Because the notes were sold in a private placement and are unregistered, secondary trading will be limited to qualified buyers or pursuant to exemptions. The company also issued a press release announcing the closing on January 30, 2026.