A non-performing note is essentially a note that is in default (more than 30 days past due) and for which the lender can not anticipate repayment according to the original terms. These notes are often referred to as a "foreclosure in incubation". The opportunity to purchase these assets at a deep discount is what makes acquisition of non-performing notes so attractive. In this market, non-performi
ng notes can be acquired for anywhere between 20% - 60% of the note value. Non-performing notes are priced so aggressively because the lender has a blemish on its balance sheet that is not only unproductive, but also further restrict a bank's lending ability due to the additional reserves that are required by the FDIC. There are an estimated 10.5 million notes that are currently more than 30 days past due. As a result, federal bank regulators, like the Office of Comptroller of the Currency (OCC), are concerned about the effect these increases will have on the financial stability of the institutions they supervise. Therefore, they are putting significant pressure on these banks to decrease the amount of non-performing real estate notes on their books. This current situation has created the perfect storm of opportunity for buyers of distressed real estate properties. At Parkcanon Capital, LLC, we are focused primarily on the acquisition of defaulted residential mortgages notes and the management of workout solutions to a profitable resolution . We work and consult with a small group of investor partners whose strategy includes the purchase of mortgage notes. Because of various economic factors, Parkcanon Capital, LLC is able to acquire defaulted mortgage loans nationwide for significantly less than the dollar owed. We are trained in the acquisition of non-performing and defaulted notes. Our many years of experience assigning valuations to a broad band of asset types have yielded considerable expertise at recognizing the value of a particular collateral asset. Because a mortgage note is secured by real property, Parkcanon Capital, LLC has a high degree of confidence of having a safer, more profitable return than is typically available with traditional types of paper-backed investments.
