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USE OF SPECIAL PURPOSE ENTITIES AND VARIABLE INTEREST ENTITIES (Tables)
 3 Months Ended
Mar. 31, 2021
Variable Interest Entity [Line Items]  
Summary of Loan and Borrowing Characteristics COMMERCIAL MORTGAGE LOANS HELD-FOR-INVESTMENTThe following tables summarize certain characteristics of the Company's investments in commercial mortgage loans as of March 31, 2021 and December 31, 2020:
Weighted Average
Loan TypeUnpaid Principal BalanceCarrying ValueLoan CountFloating Rate Loan %
Coupon(1)
Remaining
Term
 (Years)(2)
March 31, 2021
Loans held-for-investment
Senior secured loans(3)
$484,165,249 $484,165,249 34 100.0 %5.1 %2.9
484,165,249 484,165,249 34 100.0 %5.1 %2.9

Weighted Average
Loan TypeUnpaid Principal BalanceCarrying ValueLoan CountFloating Rate Loan %
Coupon(1)
Remaining
Term
 (Years)(2)
December 31, 2020
Loans held-for-investment
Senior secured loans(3)
$547,345,334 $547,345,334 40 100.0 %5.1 %3.1
547,345,334 547,345,334 40 100.0 %5.1 %3.1

(1)    Weighted average coupon assumes applicable one-month LIBOR of 0.11% and 0.14% as of March 31, 2021 and December 31, 2020, respectively, inclusive of weighted average floors of 1.54% and 1.64%, respectively.
(2)    Weighted average remaining term assumes all extension options are exercised by the borrower, provided, however, that our loans may be repaid prior to such date.
(3)    As of March 31, 2021, $468,945,755 of the outstanding senior secured loans were held in VIEs and $15,219,494 of the outstanding senior secured loans were held outside VIEs. As of December 31, 2020, $531,363,401 of the outstanding senior secured loans were held in VIEs and $15,981,933 of the outstanding senior secured loans were held outside VIEs.

Activity: For the three months ended March 31, 2021, the loan portfolio activity was as follows:
Commercial Mortgage Loans Held-for-Investment
Balance at December 31, 2020$547,345,334 
Purchases and fundings34,888,000 
Proceeds from principal payments(98,068,085)
Balance at March 31, 2021$484,165,249 

Loan Risk Ratings: As further described in Note 2, the Company evaluates the commercial mortgage loan portfolio on a quarterly basis and assigns a risk rating based on a variety of factors. The following table presents the principal balance and net book value of the loan portfolio based on the Company's internal risk ratings as of March 31, 2021 and December 31, 2020:

March 31, 2021December 31, 2020
Risk RatingNumber of LoansUnpaid Principal BalanceNet Carrying ValueNumber of LoansUnpaid Principal BalanceNet Carrying Value
1— $— — — — — 
210 149,871,667 149,871,667 14 168,401,366 168,401,366 
321 293,534,594 293,534,594 20 309,726,343 309,726,343 
43 40,758,988 40,758,988 6 69,217,625 69,217,625 
5— — — — — — 
34 $484,165,249 484,165,249 40 547,345,334 547,345,334 

As of March 31, 2021, the average risk rating of the commercial mortgage loan portfolio was 2.7 (Moderate Risk), weighted by investment carrying value, with 91.6% of commercial loans held-for-investment rated 3 (Moderate Risk) or better by the Company's Manager.

As of December 31, 2020, the average risk rating of the commercial mortgage loan portfolio was 3.1 (Moderate Risk), weighted by investment carrying value, with 84.4% of commercial loans held-for-invested rated 3 (Moderate Risk) or better by the Company's Manager.

The decrease in average risk rating is primarily the result of commercial mortgage loans that paid off with a risk rating of "4" of $16.7 million, the purchase of $34.9 million of commercial mortgage loans with a risk rating of "2" and the migration of $31.1 million of commercial mortgage loans from a risk rating of "4" to a risk rating of "3" during the first quarter of 2021.
Concentration of Credit Risk: The following tables present the geographic and property types of collateral underlying the Company's commercial mortgage loans as a percentage of the loans' carrying value as of March 31, 2021 and December 31, 2020:

Loans Held-for-Investment
March 31, 2021December 31, 2020
Geography
Southwest39.0 %38.7 %
South30.4 36.5 
Midwest19.0 16.8 
Mid-Atlantic7.0 6.2 
West4.6 1.8 
Total100.0 %100.0 %

March 31, 2021December 31, 2020
Collateral Property Type
Multifamily88.2 %89.5 %
Retail7.2 6.4 
Office3.7 3.3 
Self-Storage0.9 0.8 
Total100.0 %100.0 %

We did not have any impaired loans, nonaccrual loans, or loans in maturity default as of March 31, 2021 or December 31, 2020.
Hunt CRE 2017-FL1, Ltd. and Hunt CRE 2018-FL2, Ltd.  
Variable Interest Entity [Line Items]  
Condensed Consolidated Balance Sheets
The carrying values of the Company's total assets and liabilities related to Hunt CRE 2017-FL1, Ltd. and Hunt CRE 2018-FL2, Ltd. at March 31, 2021 and December 31, 2020 included the following VIE assets and liabilities:

ASSETSMarch 31, 2021December 31, 2020
Cash, cash equivalents and restricted cash$32,154,188 $57,999,396 
Accrued interest receivable(1)
2,110,781 1,955,709 
Investment related receivable(2)
34,188,949 — 
Loans held for investment468,945,755 531,363,401 
Total Assets$537,399,673 $591,318,506 
LIABILITIES
Accrued interest payable$312,071 $351,877 
Collateralized loan obligations(3)
409,404,872 463,060,090 
Total Liabilities$409,716,943 $463,411,967 
Equity127,682,730 127,906,539 
Total liabilities and equity$537,399,673 $591,318,506 
(1)    Accrued interest receivable includes $498,911 of interest and exit fees receivable, which were settled subsequent to March 31, 2021.
(2)    Investment related receivable relates to one loan in Hunt CRE 2017-FL1 with a principal amount due of 9,808,696 and two loans in Hunt CRE 2018-FL2 with principal amounts due of $24,380,253 which paid off in March 2021 after the March remittance and were received in April. The Hunt CRE 2017-FL1 repayment will be used to pay down the Class A Notes of the CLO in April 2021.
(3)     The stated maturity of the collateral loan obligations per the terms of the underlying collateralized loan obligation agreement is August 15, 2034 for Hunt CRE 2017-FL1, Ltd. and August 15, 2028 for Hunt CRE 2018-FL2, Ltd.
Summary of Loan and Borrowing Characteristics
The following tables present certain loan and borrowing characteristics of Hunt CRE 2017-FL1, Ltd. and Hunt CRE 2018-FL2, Ltd. as of March 31, 2021 and December 31, 2020:
As of March 31, 2021
Collateralized Loan ObligationsCountPrincipal Value
Carrying Value(1)
Wtd. Avg. Yield
Collateral (loan investments)34$468,945,755 $468,945,755 
L + 3.53%
Financings provided2411,242,221 409,404,872 
L + 1.50%

As of December 31, 2020
Collateralized Loan ObligationsCountPrincipal Value
Carrying Value(1)
Wtd. Avg. Yield
Collateral (loan investments)40$531,363,401 $531,363,401 
L + 3.50%
Financing provided2465,316,126 463,060,090 
L + 1.44%

(1)     The carrying value for Hunt CRE 2017-FL1, Ltd. is net of discount of $0 and $207,767 for March 31, 2021 and December 31, 2020, respectively and the carrying value for Hunt CRE 2018-FL2, Ltd. is net of debt issuance costs of $1,837,349 and $2,048,269 for March 31, 2021 and December 31, 2020, respectively.
Condensed Consolidated Statements of Operations
The statement of operations related to Hunt CRE 2017-FL1, Ltd. and Hunt CRE 2018-FL2, Ltd. for the three months ended March 31, 2021 and March 31, 2020 include the following income and expense items:
Statements of OperationsThree Months Ended March 31, 2021Three Months Ended March 31, 2020
Interest income$7,263,861 $9,032,178 
Interest expense(2,185,242)(4,237,889)
Net interest income$5,078,619 $4,794,289 
General and administrative fees(120,586)(145,986)
Net income$4,958,033 $4,648,303