We’ve experienced a very solid second quarter with the asset managers making progress on the non-performing loans they are working out with borrowers. We purchased a handful of smaller pools of non-performing notes in the second quarter and have recently bid on a few larger packages. Even the most difficult loans have returned dividends so far. Borrowers who have been hit hardest by the recession often qualify for state or federal money that help them pay their notes. We have approximately twenty of these types of relief-request applications in the pipeline.
One of our many strategies for maximizing the value of the Stonecrest Income & Opportunity Fund’s assets is to position our land contracts for the most advantageous sale possible. This usually means working out delinquent tax issues.
On the land contract buyer’s side, we typically increase their impound accounts in order to ensure payment of taxes and insurance. But we also approach tax issues by working with the cities in which the properties are located in order to reduce the overall amount of tax due through reassessment. We’ve researched and identified many citywide programs that allow for property tax reductions. These programs usually offer tax breaks to owners based on characteristics such as age, prior military service, etc.
We go beyond just identifying these city tax reduction and state/federal mortgage relief programs, and work closely with buyers and borrowers to properly fill out the numerous, complicated forms that they need to file. Each program is unique and because they are government sponsored, they take much more time than we would like. However, we find that our patience grows in direct proportion to the size of the checks we expect.
2nd Quarter 2013 Total Fund Rate of Return: 7.72%
Total Fund Annualized Return Since Inception: 28.51%
|Performance Since Inception|
|Land Contracts Summary|
|Face Value of Notes||$18,032,885|
|Non-performing Notes Summary|
|Cost of Notes||$4,912,734|
|Modified Notes Summary|