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SERVICING ASSETS
 12 Months Ended
Dec. 31, 2025
Transfers and Servicing [Abstract]  
SERVICING ASSETS
NOTE 7—SERVICING ASSETS:
Servicing assets held by NSBF are measured at fair value and the Company performs valuations on a quarterly basis. Servicing assets held by Newtek Bank, including Newtek Bank’s subsidiary SBL, are measured at lower of cost or market where the assets are initially recorded at fair value, then subsequently amortized, and assessed for impairment each reporting period.
The Company earns servicing fees from the guaranteed portions of SBA 7(a) loans it originates and sells, for the unguaranteed portions of SBA 7(a) loans in the NSBF sponsored securitizations, and for the portfolios of ALP loans SBL services for the NCL JV (dissolved in September 2025), TSO JV sponsored securitization and Newtek ALP Holdings and its sponsored securitization.
The following table summarizes the unpaid principle balance of loans serviced at December 31, 2025 and December 31, 2024:
December 31, 2025December 31, 2024
SBA 7(a)
$1,698,866 $1,996,715 
ALP
345,856 169,842 
50448,302 12,475 
Total loans serviced
$2,093,024 $2,179,032 
The following table summarizes the fair value and valuation assumptions related to servicing assets at December 31, 2025 and December 31, 2024:
December 31, 2025December 31, 2024
WeightedRangeWeightedRange
Unobservable Input
Amount
AverageMinimumMaximum
Amount
AverageMinimumMaximum
Servicing assets at FV:
$15,358 $22,062 
Discount factor1
11.25 %11.25 %11.25 %12.00 %12.00 %12.00 %
Cumulative prepayment rate22.50 %22.50 %22.50 %22.50 %22.50 %22.50 %
Average cumulative default rate21.00 %21.00 %21.00 %21.00 %21.00 %21.00 %
Servicing assets at LCM:
29,564 24,195 
Discount factor1
11.27 %10.75 %12.00 %12.97 %12.00 %13.50 %
Cumulative prepayment rate33.72 %22.50 %50.00 %34.65 %22.50 %75.00 %
Average cumulative default rate16.95 %5.00 %21.00 %18.90 %5.00 %20.00 %
Total
$44,922 $46,257 
1 Determined based on risk spreads and observable secondary market transactions.
Refer to NOTE 10—FAIR VALUE MEASUREMENTS for a rollforward of servicing assets, at fair value. The following tables show a rollforward of servicing assets, at LCM for the years ended December 31, 2025 and 2024:
Servicing Assets, at LCMDecember 31, 2025December 31, 2024
Balance at beginning of the year
$24,195 $10,389 
Amortization1
(9,989)(5,378)
Additions2
15,358 19,184 
Impairment assessment
— — 
Balance at end of the year
$29,564 $24,195 
1    Included within Net loss on loan servicing assets in the Consolidated Statements of Income
2    Included within Net gains on sales of loans in the Consolidated Statements of Income
Servicing income earned for the years ended December 31, 2025, 2024 and 2023 was as follows:

Year Ended December 31,
202520242023
Servicing income
$22,850$20,087$18,289