Fair Value of Financial Instruments

9 Months Ended

Sep. 30, 2025

Note 3 – Fair Value of Financial Instruments

Under FASB ASC 820-10-5, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). The standard outlines a valuation framework and creates a fair value hierarchy in order to increase the consistency and comparability of fair value measurements and the related disclosures. Under GAAP, certain assets and liabilities must be measured at fair value, and FASB ASC 820-10-50 details the disclosures that are required for items measured at fair value.

HUBILU VENTURE CORPORATION
Notes to Condensed Consolidated Financial Statements

(Unaudited)

The Company has cash and debts that must be measured under the fair value standard. The Company’s financial assets and liabilities are measured using inputs from the three levels of the fair value hierarchy. The three levels are as follows:

Level 1 – Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.

Level 2 – Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs).

Level 3 – Unobservable inputs that reflect our assumptions about the assumptions that market participants would use in pricing the asset or liability.

The following schedule summarizes the valuation of financial instruments at fair value on a recurring basis in the balances sheet as of September 30, 2025 and December 31, 2024:

	Level 1		Level 2			Level 3
	Fair Value Measurements at September 30, 2025
	Level 1		Level 2			Level 3
Assets
Cash	$	107,252	$	-		$	-
Total assets		107,252		-			-
Liabilities
Due to related party		-		474,271			-
Mortgages payable, related party		-		1,017,094			-
Mortgages payable, net of debt discounts		-		22,615,736			-
Dividends payable		-		224,891			-
Convertible preferred stock payable		-		-			520,400
Total liabilities		-		24,331,992			520,400
Net asset (liabilities)	$	107,252	$	(24,331,992	)	$	(520,400	)

HUBILU VENTURE CORPORATION

Notes to Condensed Consolidated Financial Statements

(Unaudited)

	Level 1		Level 2			Level 3
	Fair Value Measurements at December 31, 2024
	Level 1		Level 2			Level 3
Assets
Cash	$	9,799	$	-		$	-
Total assets		9,799		-			-
Liabilities
Due to related party		-		474,271			-
Mortgages payable, related party		-		599,594			-
Mortgages payable		-		20,211,798			-
Dividends payable		-		205,483			-
Convertible preferred stock payable		-		-			520,400
Total liabilities		-		21,491,146			520,400
Net asset (liabilities)	$	9,799	$	(21,491,146	)	$	(520,400	)

There were no transfers of financial assets or liabilities between Level 1 and Level 2 inputs for the three months ended September 30, 2025 or the year ended December 31, 2024.

Hubilu Venture Corp 10-Q