PERFORMANCE

Coupon 13-15% in USD terms, net of fees, paid on a quarterly basis

GENERAL OVERVIEW

INVESTMENT FOCUS 

 

  • Non-qualified mortgage loan segment (non-QM)

  • Fund targets borrowers with high credit ratings who can confirm their income

  • Downside protection of 30-35% of the down payment

  • Diversified portfolio of 800+ loans totaling $250 million with an average loan size of $300k

  • Average mortgage rate of 5.75% annually

  • Late payment share: 1% (historical data)

MARKET

  • US mortgage market volume: $1.4 trillion annually

  • Total volume of non-QM loans: $35 billion annually

  • Share of payments late by 30 days has fallen threefold in 5 years

  • Volume of unmet demand of non-QM loans: $200-300 billion

RISK

  • All real estate is subject to independent assessment before issuing loans

  • During the 2008 crisis, the real estate market declined by 18%, and the default rate was 18-22%

  • Assuming a 30-35% down payment, a 30% real estate price drop would not lead to a loss for investors, even with a large share of defaults

  • According to a consumer survey by FRS, real estate prices are expected to grow by 1.3% in 2020. Meanwhile, Zillow expects a 2-4% price drop

For more details please contact:

info@itifunds.com

Investing in US real estate

backed mortgage loans 

Fund 

Information 

Minimum investment:

US$ 150,000

 

Total volume:

US$ 50 mn

Starting fund volume:

$10 mn:

the fund manager has allocated
$5 mn in the fund

+ $5 mn investor’s commitment

Fees:

Subscription: up to 5%

Management fee: 1.5%

Performance fee: 50%*

* the success fee is only charged on returns above 8% p.a.

Hurdle rate: 8%

Fund manager:

ITI Funds 

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Fund 

Information

Investment horizon:

36 months

 

Structure: 

RAIF

 

Available in Euroclear:

Yes

 

Co-investors:

95%: Morgan Stanley, Bank of America, insurance companies

 

Service providers:

Mortgage loan portfolio 
management: Imperial Fund

Mortgage examination:

banking group - Home Federal Bank of Hollywood

Administrator:

Mainstream Fund Administrator

 

States of presence:

 

AZ – Arizona

СA – California

CO – Colorado

CT – Connecticut

FL – Florida

GA – Georgia

NC – North Carolina

NJ – New Jersey

NY – New York

MD – Maryland

PA – Pennsylvania

SC – South Carolina

TX – Texas

VA - Virginia

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Portfolio loans:

Borrowers with high credit scores:

weighted average FICO score: 720

Borrower profiles:

  1. 95% of borrowers are self-employed and small business owners

  2. 5% are self-employed and able to confirm high incomes; however, non-QM borrowers cannot qualify for QM mortgages as they do not have W-2 / 2 years of tax returns / paystubs, which are key requirements for QM mortgage loans (QM):

  • DTI: borrower’s debt to income ratio is 43% or less

  • Income verification: 2 year tax returns or W-2 + paystubs

  • Automated underwriting

Mortgage rate: 5.75%

High initial deposit: 30 -35% of property value

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