Whole Loan Capital, LLC
Opportunities In Mortgages
How To Prosper
When Banks Don’t
Whole Loan Capital, LLC
Whole Loan Fund
Investment Thesis
• Banks have dramatically reduced their mortgage appetites:
– 95% of all mortgages today go to a GSE (FNMA, FHLMC, GNMA)
– Jumbo mortgage lending has decreased by over 90%
• Historic bank and lender failures have forced billions in loan sales
• Credit tightening has swung too far as bank over-correct:
– 1 in 2 home improvement loans are rejected – 1 in 3 overall
– Banks have withdrawn many loan programs leaving a vacuum
• Consolidation has taken place:
– 66% of all loans are made by the top 10 banks
• Fixed Income investments trump overpriced equities – page 9
• Home prices have reset to sustainable levels
¾ There has never been a better time to make or purchase high yield,
low risk loans. For new loans, focus on niches no longer offered by
banks. In all cases focus on low risk situations.
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Whole Loan Capital, LLC
Whole Loan Fund
Objective
• Return 12% or higher cash-on-cash returns by investing in
residential single family mortgage loans
• Provide simplicity and complete transparency
Strategy
• Make and hold new low risk loans on residential properties in
specified geographic locations:
– Dictate terms
– Make loans with 60% or lower Loan-To-Value ratios
– Focus on niches no longer offered by banks
• Buy performing existing mortgage loans made in the past
three years at substantial discounts
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Whole Loan Capital, LLC
Whole Loan Fund
Keys to Success:
• Loan sourcing
• Credit underwriting and loan due diligence
• Loan closing capabilities
• Servicer to handle the monthly cash flow and tax reporting
• Custodian to hold notes and mortgages
• Loan advisor/manager to handle the entire process
Whole Loan Capital Capabilities:
• Relationships with lenders/banks/hedge funds/brokers
• In-house credit review function and historic perspective on credit
underwriting – page 10
• Network of lenders capable of closing loans
• Servicer to handle individual loans on a cost effective basis
• Custodian in place to hold notes and mortgages for investors
• Capable of facilitating entire process as needed for investors
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Whole Loan Capital, LLC
Whole Loan Fund
Options For Investors
• Purchase individual loans or participations:
– Whole Loan Capital can service the loan
– Can provide credit due diligence expertise and advice
• Invest in Whole Loan Fund, LP – a forming limited
partnership:
– Simpler execution for investors
– Monthly reporting and dividend distributions
– Diversification of risk
– External custodian holds notes
– Fund to be managed by Whole Loan Capital, LLC
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Whole Loan Capital, LLC
Whole Loan Fund
Recent Transactions
Warren County,
Loan Amount:
NJ
$ 60,000
LTV: 24%
Property Value:
$ 250,000
New Haven, CT
Loan Amount:
$ 13,000
LTV: 8%
Property Value:
$ 160,000
Property Type: Land
Lien Type: First
Note Rate: 14%
Loan Term: 3 Year
Property Type: Single Family
Lien Type: First
Note Rate: 8.5%
Cash Yield of 30%
Loan Term: 34 Months
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Whole Loan Capital, LLC
Whole Loan Fund
Management
David A. Akre
• Co-founder, Co-CEO, New York Mortgage Trust – publicly traded mortgage
REIT. Responsible for residential whole loan portfolio, loan purchase
program, overall portfolio risk management & daily operations. 6 years.
• Capital Markets, Thornburg Mortgage. Acquired and managed $3 billion in
whole loan mortgage investments. Reported to CEO. 6 years.
• GE Capital Mortgage Corporation – purchased whole loans for conduit and
public pension fund securitization. 7 years.
• Security Pacific Merchant Bank – sold mortgage securitizations to
institutional fixed income investors. 3 years.
• Mortgage originations – retail mortgage lending. 2 years.
Maureen G. Stewart
• Mortgage loan acquisition credit review, lender operations review, and credit
policy management - Bayview Portfolio Services, Morgan Stanley, The
Clayton Group, others. 19 Years.
• Senior mortgage underwriter and lending operations management - First
Federal Savings of Rochester, Eastern Savings Bank, others. 10 Years.
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Whole Loan Capital, LLC
Whole Loan Fund
More Information
David Akre
[email protected]
(212) 786-2329
www.wholeloans.com
DISCLAIMER
This is not an Offer to Purchase or Sell Securities. This overview is for informational purposes and is not an offer
to sell or a solicitation of an offer to buy any securities in Whole Loan Fund, L.P., a to-be formed limited partnership
(the “Fund”), and may not be relied upon in connection with the purchase or sale of any security. Interests in the
Fund, if offered, will only be available to parties who are “accredited investors” (as defined in Rule 501 promulgated
pursuant to the Securities Act of 1933, as amended) and who are interested in investing in the Fund on their own
behalf. Any offering or solicitation will be made only to qualified prospective investors pursuant to a confidential
offering memorandum, and the subscription documents, all of which should be read in their entirety.
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Whole Loan Capital, LLC
Whole Loan Fund
Fixed income investments have achieved their rightful place in
the investment spectrum.
Financial Times October 15, 2009
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Whole Loan Capital, LLC
Whole Loan Fund
Credit Comparison – Discretionary credit decisions by New
York Mortgage Trust under David Akre versus peer group
Source: Bloomberg. Data is as of Mr. Akre departure date from NYMT.
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