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USE OF SPECIAL PURPOSE ENTITIES AND VARIABLE INTEREST ENTITIES
 9 Months Ended
Sep. 30, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
USE OF SPECIAL PURPOSE ENTITIES AND VARIABLE INTEREST ENTITIES USE OF SPECIAL PURPOSE ENTITIES AND VARIABLE INTEREST ENTITIES
We account for CLO transactions on our consolidated balance sheet as financing facilities. Our CLOs are VIEs for which we are the primary beneficiary and are consolidated in our financial statements. The investment grade tranches are treated as secured financings, and are non-recourse to us. See Note 2 ("Summary of Significant Accounting Policies - Principles Consolidation - VIE") for further discussion.

On June 14, 2021, the Company completed a CRE CLO ("LFT CRE 2021-FL1, Ltd."), issuing eight tranches of CLO notes through two newly-formed wholly-owned subsidiaries totaling $903.8 million. Of the total CLO notes issued $833.8 million were investment grade notes issued to third party investors and $70 million were below investment-grade notes retained by us. In addition, a $96.25 million equity interest in the portfolio was retained by us. As of the CLO closing date, the notes were secured by a portfolio of loan obligations with a face value of $669.7 million, consisting primarily of bridge loans that were contributed from our existing loan portfolio and affiliates of the Company. The financing has an initial two-and-a-half year reinvestment period that allows principal proceeds of the loan obligations to be reinvested in qualifying replacement loan obligations, subject to the satisfaction of certain conditions set forth in the indenture. Thereafter, the outstanding debt balance will be reduced as loans are repaid. Initially, the proceeds of the issuance of the securities also included $330.3 million for the purpose of acquiring additional loan obligations or a period of up to 180 days from the CLO closing date, resulting in the issuer owning loan obligations with a face value of $1.0 billion, representing leverage of 83%. We retained a residual interest in the portfolio with a notional amount of $166.2 million, including the $70 million below investment-grade notes.

On June 14, 2021, the Company unwound Hunt CRE 2017-FL1, Ltd. and Hunt CRE 2018-FL2, Ltd. redeeming $388.2 million of outstanding notes which were repaid primarily from the refinancing of the remaining assets primarily within LFT 2021-FL1, Ltd., as well as cash held within Hunt CRE 2018-FL2, and expensed $1.7 million of deferred financing costs into loss on extinguishment of debt on the consolidated statements of operations. As of this date, the Company no longer consolidates the assets and liabilities as of Hunt CRE 2017-FL1, Ltd. and Hunt CRE 2018-FL2, Ltd.

The CRE CLO we consolidate is subject to collateralization and coverage tests that are customary for these types of securitizations. As of September 30, 2021 and December 31, 2020 all such collateralization and coverage tests in the CRE CLOs we consolidate were met. If the duration of the COVID-19 pandemic continues to prolong, its impact on our borrowers and their tenants could result in a sustained deterioration in a material amount of assets and may impact these tests.

The carrying values of the Company's total assets and liabilities related to LFT CRE 2021-FL1, Ltd. at September 30, 2021 and Hunt CRE 2017-FL1, Ltd. and Hunt CRE 2018-FL2, Ltd. at December 31, 2020 included the following VIE assets and liabilities:

ASSETSSeptember 30, 2021December 31, 2020
Cash, cash equivalents and restricted cash$148,066,240 $57,999,396 
Accrued interest receivable3,082,676 1,955,709 
Investment related receivable48,890,010 — 
Loans held for investment803,074,256 531,363,401 
Total Assets$1,003,113,182 $591,318,506 
LIABILITIES
Accrued interest payable$562,499 $351,877 
Collateralized loan obligations(1)
826,145,358 463,060,090 
Total Liabilities$826,707,857 $463,411,967 
Equity176,405,325 127,906,539 
Total liabilities and equity$1,003,113,182 $591,318,506 

(1)     The stated maturity of the collateral loan obligations per the terms of the underlying collateralized loan obligation agreement is June 14, 2039 for LFT CRE 2021-FL1, Ltd., August 15, 2034 for Hunt CRE 2017-FL1, Ltd. and August 15, 2028 for Hunt CRE 2018-FL2, Ltd.

The following tables present certain loan and borrowing characteristics of LFT CRE 2021-FL1, Ltd. as of September 30, 2021 and Hunt CRE 2017-FL1, Ltd. and Hunt CRE 2018-FL2, Ltd. as of December 31, 2020:
As of September 30, 2021
Collateralized Loan ObligationsCountPrincipal Value
Carrying Value(1)
Wtd. Avg. Yield
Collateral (loan investments)53$803,043,750 $803,074,256 
L + 3.46%
Financings provided1833,750,000 826,145,358 
L + 1.43%
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 LFT CRE 2021-FL1, Ltd. is net of debt issuance costs of $7,604,638 for September 30, 2021, Hunt CRE 2017-FL1, Ltd. is net of discount of $207,767 for December 31, 2020, and the carrying value for Hunt CRE 2018-FL2, Ltd. is net of debt issuance costs of $2,048,269 for December 31, 2020.

The statement of operations related to LFT CRE 2021-FL1, Ltd., Hunt CRE 2017-FL1, Ltd. and Hunt CRE 2018-FL2, Ltd. for the three and nine months ended September 30, 2021 and September 30, 2020 include the following income and expense items:

Statements of OperationsThree Months Ended September 30, 2021Three Months Ended September 30, 2020
Interest income$9,412,072 $7,900,183 
Interest expense(3,891,093)(2,495,996)
Net interest income$5,520,979 $5,404,187 
General and administrative fees(118,804)(201,459)
Net income$5,402,175 $5,202,728 

Statements of OperationsNine Months Ended September 30, 2021Nine Months Ended September 30, 2020
Interest income$24,543,893 $25,225,152 
Interest expense(8,288,278)(9,649,523)
Net interest income$16,255,615 $15,575,629 
General and administrative fees(147,604)(497,088)
Net income$16,108,011 $15,078,541