The secured financing and warehouse facilities were utilized to finance the origination and purchase of commercial real estate mortgage loans. Warehouse facilities are designated to fund mortgage loans that are purchased and originated within specified underwriting guidelines. These lines of credit fund less than 100% of the principal balance of the mortgage loans originated and purchased, requiring the use of working capital to fund the remaining portion.

On August 29, 2019, the Company entered into a five-year $153.0 million corporate debt agreement with Owl Rock Capital Corporation, the “2019 Term Loan”. The 2019 Term Loan under this agreement bears interest at a rate equal to one-month LIBOR (with a LIBOR floor that is generally 1.0%) plus 7.50% and matures in August 2024.

As of June 30, 2020 and December 31, 2019, the balance of the 2019 Term Loan was $78.0 million and $153.0 million, respectively. In January 2020, the Company used a portion of its IPO proceeds to pay down $75.0 million in principal amount of the 2019 Term Loan. The balance in the consolidated Statements of Financial Condition is net of debt issuance costs of $3.4 million and $7.4 million, respectively. The 2019 Term Loan is secured by substantially all assets of the Company not otherwise pledged under a securitization or warehouse facility and contains certain reporting and financial covenants. Should the Company fail to adhere to those covenants or otherwise default under the notes, the lenders have the right to demand immediate repayment that may require the Company to sell the collateral at less than the carrying amounts. As of June 30, 2020 and December 31, 2019, the Company was in compliance with these covenants.

The Barclays Repurchase Agreement was originally entered into on May 29, 2015 by and between VCC and Barclays Bank PLC and matured on August 3, 2020. The agreement was a short-term borrowing facility, collateralized by a pool of loans, with an initial maximum capacity of $300.0 million, and borne interest at one-month LIBOR plus a margin that ranges from 3.000% to 3.125%. All borrower payments on loans financed under the warehouse repurchase facility were first used to pay interest on the facility. For the six months ended June 30, 2020 and 2019, the effective interest rates were 4.81% and 5.90%, respectively.

The Citibank Repurchase Agreement was originally entered into on May 17, 2013 by and between VCC and Citibank, N.A. and has a current maturity date of September 30, 2020. The Agreement is a short-term borrowing facility, collateralized by a pool of performing loans, with a maximum capacity of $200.0 million, and bears interest at one-month LIBOR plus 3.25%. All borrower payments on loans financed under the warehouse repurchase facility are first used to pay interest on the facility. For the six months ended June 30, 2020 and 2019, the effective interest rates were 4.29% and 5.78%, respectively.

On September 12, 2018, the Company entered into a three-year secured revolving loan facility agreement with Pacific Western Bank. During the borrowing period, the Company can take loan advances from time to time subject to availability. Each loan advance bears interest at the lesser of the one-month LIBOR Rate plus 3.5% per annum and the maximum rate, which is the highest lawful and non-usurious rate of interest applicable to the loan. The maximum loan amount under this facility is $50 million. This facility was paid down to zero as of June 30, 2020.

On December 26, 2019, the Company entered into a $3.0 million loan agreement with Hershiser Capital Finance, the “HCF loan”. The HCF loan is secured by five real properties acquired by the Company through foreclosure or by deed-in lieu of foreclosure. The HCF loan bears a fixed interest rate of 9.5%, and matures the earlier of (i) January 1, 2021, and (ii) the date on which the unpaid principal balance of this loan becomes due and payable by acceleration or otherwise pursuant to the loan documents or the exercise by the lender of any right or remedy under any loan document. The maturity date of the HCF loan is subject to extension up to July 1, 2021.

Certain of the Company’s loans are pledged as security under the warehouse repurchase facilities and the revolving loan facility, which contain covenants. Should the Company fail to adhere to those covenants or otherwise default under the facilities, the lenders have the right to terminate the facilities and demand immediate repayment that may require the Company to sell the collateral at less than the carrying amounts. As of June 30, 2020 and December 31, 2019, the Company was in compliance with these covenants.

The following table summarizes the maximum borrowing capacity and current gross balances outstanding for the Company’s warehouse facilities and loan agreements as of June 30, 2020 and December 31, 2019 (in thousands):

	June 30, 2020				December 31, 2019
	Period end balance⁽¹⁾		Maximum borrowing capacity		Period end balance⁽¹⁾		Maximum borrowing capacity
Barclays repurchase agreement	$	71,522	$	300,000	$	226,212	$	250,000
Citibank repurchase agreement		87,098		200,000		190,977		200,000
Pacific Western credit agreement		—		50,000		2,499		50,000
Hershiser Capital Finance loan agreement		2,820		3,000		3,000		3,000

(1)	Warehouse repurchase facilities amounts in the consolidated balance sheets are net of debt issuance costs amounting to $0.6 million and $1.1 million as of June 30, 2020 and December 31, 2019, respectively.

The following table provides an overview of the activity and effective interest rate for the six months ended June 30, 2020 and 2019 (dollars in thousands):

	Six Months Ended June 30,
	2020			2019
Warehouse repurchase facilities:
Average outstanding balance	$	295,013		$	197,721
Highest outstanding balance at any month-end		439,547			280,710
Effective interest rate (1)		4.70	%		5.90	%

(1)	Represents annualized interest expense divided by average gross outstanding balance and includes average rate (4.29%) and debt issue cost amortization (.41%) and average rate (5.46%) and debt issue cost amortization (0.44%) for the six months ended June 30, 2020 and 2019, respectively.

The following table provides a summary of interest expense that includes debt issuance cost amortization, interest, amortization of discount, and deal cost amortization for the six months ended June 30, 2020 and 2019 (in thousands):

	Six Months Ended June 30,
	2020			2019
Warehouse repurchase facilities	$	6,932		$	5,834
Securitizations		37,104			33,553
Interest expense — portfolio related		44,036			39,387
Interest expense — corporate debt		8,237	(1)		6,706
Total interest expense	$	52,273		$	46,093

(1)

Included in the $8.2 million of interest expense – corporate debt for the six months ended June 30, 2020 was the one-time debt issuance costs write-off of $3.5 million and prepayment penalties of $0.3 million associated with the repayment of $75.0 million in outstanding principal amount in January 2020.