Mortgage Loan Portfolio Plans Justified Move to Larger Headquarters

Feb. 1, 2012 - PRLog -- IRVINE, Calif.  – Calling 2011 “an extraordinary year for new product introductions and growth,” Group President, Bayard Closser, recently justified moving the Vertical Capital Markets Group’s headquarters to more spacious accommodations at 20 Pacifica in Irvine, California.

While depressed property values continue to bedevil the financial markets, Mr. Closser said his firm is looking to attract new investment dollars into mortgage loan portfolios that, through Vertical Recovery Management’s servicing capabilities, may have informational advantages over other property-backed investments – such as Residential Mortgage-Backed Securities (RMBS).

“As servicing agent, we know a great deal about every single mortgage in our portfolios,” Mr. Closser continued. “This also gives us the background we need to work with committed homeowners who want to restructure the principal and interest on their loans in an attempt to keep a roof over their heads.”

By packaging together whole mortgage loans that banks have been selling off to raise liquidity, Mr. Closser said he hopes to attract investors seeking higher income potential than available through conventional sources. To bolster that strategy, last month Vertical Capital Asset Management (the “Adviser”) announced the launch of the Vertical Capital Income Fund, a closed-end interval fund, which invests primarily in residential loans that are secured by first mortgages or deeds of trust

However, these notes are typically sold in groups which are difficult to value.  Up to 10% of the loans in the group or package may be delinquent or in default. The Fund will not purchase loans that currently are in foreclosure; however, loans acquired by the Fund may go into foreclosure subsequent to acquisition by the Fund. The Fund will acquire loans of borrowers with varying credit histories and may invest up to approximately 10% of its assets in loans that were classified as "sub-prime" at the time of origination.

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