Funds
12 Reasons to Invest with Capstone
Return on Investment = Yield
The projected yield to investors of Capstone Funds is 8% to 12% with a preferred yield to investors and split of remaining available cash between investors and the manager.
Capital Preservation = Managing Risk
Capital Preservation is the highest priority. The maximum Loan to Value for any loan in Capstone Funds is 70% of As-Is appraised value. Capstone retains the same appraisal management services used in normal FHA/Conventional lending for our Fix and Flip loans.
Transparency = Monthly Reporting
Capstone Financial and Capstone Funds service all our loans in house. Each month Capstone will also send each investor a 1 page, easy to read statement with their interest payments. Capstone also sends all investors a monthly video summarizing yield and fund activity.
3rd Party Loan Servicing = Collections
Clear Spring has a full collections department integrated with its loan servicing platform. This allows all normally scheduled loan collections and default loan collections to be managed on the same platform. This integration helps keep the timelines between when a borrower misses a payment and when a default resolution or borrower reinstatement payment being collected to a minimum. Borrower defaults will always occur. Part of keeping Capstone investor’s capital secure while providing a attractive return is managing these defaulting borrowers effectively. In every case in Capstone’s history, a loan is default has resulted in extra revenue and a higher return on investment for Capstone on that particular file. Defaults are a revenue opportunity if managed correctly.
Deployment of Funds = Less idle time for your Cash
Some investors involved with private lending have historically participated in single loans. However, when the loan pays off the investor is left without any. Capstone Funds address this problem by continually rotating capital through loans and delivering consistent yield to our investors.
Liquidity and Leverage = Using Bank Money
Capstone has met with several lending institutions and has a 2:1 equity to debt target. The use of some limited and conservative debt will help keep Capstone Fund Five returns in the double digits while still reserving some liquidity to fund new loans, or liquidity for early investor exits when life events create the need.
Geographic Diversity = More Managing Risk
Capstone Funds use a national wholesale program to diversify its assets geographically. As with any capital preservation strategy, some types of diversity are needed to reduce risk. As discussed, Capstone gets full 3rd party valuations and credit reports on every borrower to help identify quality files for funding in all geographic markets.
Licensed Loan Originator = Compliance with Dodd-Frank/CFPB
Capstone Financial is a licensed Mortgage Bank. With this licensing and working with rated servicer Clear Spring, Capstone makes every attempt to follow federal and state guidelines set by Dodd-Frank and the Consumer Financial Protection Board.
Standard Underwriting = Appraisals and Credit Checks
Each file Capstone Financial and Capstone Fund Five funds has a full 3rd party valuation and credit reports from all 3 major credit agencies. This helps Capstone evaluate each property, and each borrower, for every loan file. These requirements are a minimum, frequently Capstone requires borrowers to supply historical banks statements and tax returns to help support due diligence efforts. These additional items help ensure a borrower has the ability to make monthly payments on their loan while it is in Capstone and Capstone Fund Five’s portfolio.
Experienced Team = We have never lost any principle
Capstone Financial has never lost any principal amount in any default scenario. Capstone Funds management team has extensive experience in selling bank owned properties and has access to a national network of other experienced real estate professionals to manage assets profitably when needed.
1st Lien Position = Be the bank, Be more secure
Capstone Fund Five will always be the 1st position on any collateral for a loan. Capstone will not lend above 70% Loan to Value on any of these 1st position liens. While real estate 1st position liens do not guarantee against any capital loss, a conservative valuation approach combined with a conservative Loan to Value limit helps ensure reasonable security in Capstone’s collateral positions.
Capstone is enjoyable to work with = Enjoy your life
Above everything, we all choose with whom to spend time and do business. With Capstone Funds, it is purely a choice based on investment goals and having confidence you will enjoy working with the team at Capstone. Any business relationship, or any relationship period, will have instances of frustration, hardship, and confusion. Capstone is a team of capable and enjoyable people who work hard at solving problems and ironing out the wrinkles of life and business.
Please feel free to request a call or a personal visit to our office in Scottsdale to meet and go through any questions you may have.