So, that’s a big plus for us. And in terms of the deal cost, keep in mind all the loans that we’re doing now, we are applying fair value accounting to. So, on all the origination costs, and if there were deal costs, we don’t defer and amortize it anymore on the fair value loans. You have to recognize those costs upfront. And the short-term loans, we are applying fair value to just as we are in the long-term loans.
Stephen Laws: Great. Appreciate you highlighting that. I appreciate the comments this afternoon. Thank you.
Chris Farrar: Thanks Stephen.
Operator: The next question comes from Sarah Barcomb with BTIG. Please go ahead
Sarah Barcomb: Hey everyone. Congrats on the quarter and thanks for taking the question. So, you had another quarter of strong gains on those NPL resolutions. I was hoping you could give a little bit more context on your outlook for NPLs and resolutions on the NPLs. If we kind of assume that we could see another rate hike in that we’re in this higher-for-longer QT cycle, higher interest rate backdrop through next year, can you give your outlook on how that might evolve?
Chris Farrar: Yes, sure. Sarah, thanks for joining. I think we feel very good about the outlook there. There’s a lot of capital on the sidelines for these assets. And when we go to sell them either at the foreclosure steps or when we market, we see good activity, a lot of cash buyers. So, our view is that the rate hikes are not going to have a huge impact on the value of the recoveries that we’re getting right now, and we expect those to continue. I think if we saw the economy really start to tank and high unemployment and stress there, that probably would change my outlook or projection, if you will. So, I think it’s — as long as we continue to see strong economic activity, we believe that will come out very favorably there.
Sarah Barcomb: Great, okay. And then I was just thinking about next year, I was hoping you could talk a little bit more about the value and the earnings outlook for that fee-based income coming out of the Century portfolio and the value of the HUD license there. Just hoping you could kind of highlight that to investors a little bit.
Chris Farrar: Sure. Yes, we’re very excited with what’s going on there. We spent this year really building out the team and developing some muscle there. And we’ve got a great team of originators that we’ve increased, and our pipeline is very robust. So, we didn’t do a lot of loans this year, but we think next year is going to be quite robust and expect to see some very nice gain-on-sale income there, which is, from our perspective, is great because it’s high ROE, and then also build the servicing book. So, I’m very bullish on the opportunity for next year as they pull this pipeline through.
Sarah Barcomb: Great. Thanks so much for taking the questions and congrats again.
Chris Farrar: Thanks Sarah. Appreciate it.
Operator: [Operator Instructions] Your next question comes from Steve Delaney with JMP Securities. Please go ahead.
Steve Delaney: Thanks and good afternoon everyone, Chris, Mark and Chris, so curious about the bridge lending, and it’s great that you’ve got that new product working for you. Is there — I’m trying to think, at this point in the market and with rates where they are, and maybe, I guess, maybe going higher until today. Are you detecting, Chris, that there’s some sort of a rate play strategy on the part of borrowers, that if they’ve got a project underway, are they just buying time to go refi into another floater and then hope the long end comes down in the next one to two years before locking in to permanent? Just curious if there’s anything — any game and shift like that going on? Or do you think the bridge lending is more organic just in the form of new projects starting up and entrepreneurs actually, despite the environment, taking on new projects? Curious about your thoughts.
