Our primary goal for exit on a note acquisition is to work with the borrower to restructure their loan and make it affordable for them to remain in their home. This is a win/win since the borrower can keep their house and the asset then generates long term cash flow. In the circumstance where the borrower cannot resume performance, we will take possession of the home via DIL or foreclosure and sell it on as a “bank owned” property, usually as-is to an investor looking to do a flip or a rental.
For loans where a restructure was successful and the loan is then performing, we will liquidate the performing loan at the current market value at the time of sale. Depending upon the final outcome, the Investor will have the opportunity to buy-out the manager based on the current asset value, should the investor want to keep collecting the cash flow on a performing note.