Capital for the joint venture will be provided by a division of a top 50 global bank, as well as by Lakeport's principals
NEW YORK, Oct. 7, 2020 /PRNewswire/ -- Finitive, a financial technology platform providing institutional investors with direct access to private credit transactions, today announced that it has facilitated a joint venture between real estate investment firm Lakeport Capital ("Lakeport") and a division of one of the top 50 global banks (the "Investor") to acquire non-performing residential mortgage (NPL) portfolios. Under terms of the joint venture, the Investor has committed to purchasing up to $175 million NPLs.
Lakeport specializes in buying and working out defaulted first and second-lien mortgages in highly complex judicial foreclosure states generally avoided by other NPL buyers, such as New York, New Jersey, Connecticut and Florida. These states have among the highest delinquency rates in the U.S. following the outbreak of COVID-19, according to the Mortgage Bankers Association.
Lakeport sources, underwrites, acquires, and manages NPLs and NPL portfolios secured by single-family homes, condos, and one- to four-unit multifamily properties. It purchases defaulted NPLs at a loan-to-value of no more than 70% from small banks, medium-sized banks and non-bank lenders, including mortgage finance companies, bridge lenders, and credit funds.
"With mortgage delinquencies on the rise, now is an opportune time to purchase distressed mortgage portfolios. Many banks and other lenders are looking to remove NPLs from their balance sheets, particularly post COVID-19, to reduce overall reputational risk and address long-term profitability," said Yonel Devico, co-founder of Lakeport. "We are delighted to receive an investment from one of the world's leading financial institutions to support our growing NPL strategy."
Under the terms of the joint venture, Lakeport will identify, conduct due diligence and complete the underwriting for loan portfolios on behalf of the Investor. Once the Investor purchases the NPLs, Lakeport will work with homeowners to help them become current with payments, refinance and stay in their homes; Lakeport also buys business purpose loans and work out modifications.
The Investor will be one of several institutional buyers of NPLs through Lakeport.
The joint venture may also use leverage to purchase additional assets. Lakeport's experienced investment management team brings a strong track record of resolution: Their average time from NPL purchase to exit is 13 months.
"Lakeport Capital brings extensive NPL sourcing capabilities, foreclosure and work-out expertise to a marketplace with limited competition," said Jon Barlow, Founder and CEO of Finitive. "We are pleased to match Lakeport's outstanding team with a high-caliber institutional investor via the Finitive platform."
Founded in 2017, Lakeport started as a family office investing its own principals' money, so this transaction marks a turning point in the institutionalization of the firm, according to Jean Marc Orlando, co-founder of Lakeport.
To learn more about how Finitive matches institutional investors with private credit opportunities, including distressed loan portfolios, visit www.finitive.com.
About Lakeport Capital
Lakeport Capital is a real estate investment manager that sources, underwrites, acquires, and manages non-performing mortgage loans and non-performing mortgage loan portfolios secured by residential real estate, primarily single-family homes, condos, and one- to four-unit multifamily properties. The company has particular expertise in buying and working out defaulted first mortgages and second-lien loans in judicial foreclosure jurisdictions in New York, New Jersey, Connecticut and Florida. Lakeport Capital uses several NPL resolution strategies including litigation, foreclosure proceedings, deed in lieu, and negotiated settlements. Learn more at www.lakeportcapital.com.
Finitive is a financial technology platform providing institutional investors with direct access to private credit transactions. Through Finitive, institutional investors access a multi-trillion-dollar market that encompasses a broad spectrum of non-bank lending sectors, including specialty finance, online lending, marketplace lending, and private credit funds. Finitive's originator partners gain efficient access to a global network of investors who are actively allocating to private credit opportunities. All regulated activities are conducted through North Capital Private Securities, a registered broker-dealer and member FINRA/SIPC. For additional information, please visit Finitive's website at www.finitive.com.