A New Level of Private Lending

An investor purchases shares of the mortgage fund. The mortgage fund then lends the money out to borrowers. Borrowers make interest payments to the fund each month, and the fund pays out dividends to investors. The mortgage fund contains a large number of highly diverse trust deed loans as security for the investment, similar to a “mutual fund” of loans.

The vast majority of the portfolio is secured by California real estate.

Generally, we finance residential and commercial properties at a maximum loan-to-value ratio of 65%. We underwrite all loans with as much rigor as required to determine collateral value, insurance, credit and title history. Typically, the process is the same as that of institutional lenders.

In today’s market, sound loans are being passed over because of the capital crunch. In addition, many of our borrowers don’t want to be constrained by long timelines and rigid conditions with traditional lenders since speed is often the key in making a profitable transaction. And finally, a borrower and/or a property may fall outside the normal underwriting guidelines of conventional sources.

• Diversification: The portfolio holds loans secured by various types of properties.
• No churning: You don’t experience a payoff of your investments as with individual trust deeds.
• No idle cash: Your money won’t sit idle while you search for new investments.
• More consistent income: Your income stream is protected against an individual, non-performing loan.
• No reserve capital: By pooling loans, the fund eliminates the need for extra available capital for payment of advances, etc.