The following tables summarize certain characteristics of the Company's investments in commercial mortgage loans as of September 30, 2021 and December 31, 2020:


						Weighted Average
Loan Type	Unpaid Principal Balance		Carrying Value		Loan Count	Floating Rate Loan %		Coupon(1)		Remaining Term (Years)(2)
September 30, 2021
Loans held-for-investment
Senior secured loans(3)	$	803,043,750	$	803,074,256	53	100.0	%	4.3	%	3.7
	803,043,750		803,074,256		53	100.0	%	4.3	%	3.7


						Weighted Average
Loan Type	Unpaid Principal Balance		Carrying Value		Loan Count	Floating 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 0.08% and 0.14% as of September 30, 2021 and December 31, 2020, respectively, inclusive of weighted average floors of 0.83% 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 September 30, 2021, $803,074,256 of the outstanding senior secured loans were held in 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 nine months ended September 30, 2021, the loan portfolio activity was as follows:


	Commercial Mortgage Loans Held-for-Investment



Balance at December 31, 2020	$	547,345,334
Purchases and fundings	647,459,391
Proceeds from principal payments	(391,394,015)
Accretion of purchase discount	24,773
Amortization of purchase premium	(361,227)
Balance at September 30, 2021	$	803,074,256

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 September 30, 2021 and December 31, 2020:


	September 30, 2021				December 31, 2020
Risk Rating	Number of Loans	Unpaid Principal Balance		Net Carrying Value	Number of Loans	Unpaid Principal Balance	Net Carrying Value
1	—	$	—	—	—	—	—
2	30	463,032,213		462,940,447	14	168,401,366	168,401,366
3	21	322,567,733		322,690,005	20	309,726,343	309,726,343
4	2	17,443,804		17,443,804	6	69,217,625	69,217,625
5	—	—		—	—	—	—
	53	$	803,043,750	803,074,256	40	547,345,334	547,345,334

As of September 30, 2021, the average risk rating of the commercial mortgage loan portfolio was 2.3 (Moderate Risk), weighted by investment carrying value, with 97.8% of the net carrying value 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 the net carrying value 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 "2" of $77.0 million, a risk rating of "3" of $231.9 million and a risk rating of "4" of $17.4 million, offset by the purchase of commercial mortgage loans with a risk rating of "2" of $357.8 million and a risk rating of "3" of $224.2 million during the nine months ended September 30, 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 September 30, 2021 and December 31, 2020:

Loans Held-for-Investment


	September 30, 2021		December 31, 2020
Geography
South	44.8	%	36.5	%
Southwest	31.8		38.7
West	16.0		1.8
Mid-Atlantic	4.3		6.2
Midwest	3.1		16.8
Total	100.0	%	100.0	%


	September 30, 2021		December 31, 2020
Collateral Property Type
Multifamily	89.4	%	89.5	%
Self-Storage	7.0		0.8
Office	1.5		3.3
Retail	2.1		6.4
Total	100.0	%	100.0	%

We did not have any impaired loans, nonaccrual loans, or loans in maturity default as of September 30, 2021 or December 31, 2020.