InterCoastal
Mortgage

Mortgages- A fixed income investment that lives up to its name!

There is no mystery to mortgages. They work much like other fixed income investments, such as bonds, with a few key differences. When you purchase a bond, you’re loaning money to a corporation or government. In exchange, you receive interest income throughout the term of the loan and repayment of principal at maturity. The loan is backed by the corporation’s assets or the full faith and credit of the government.
When you invest in a mortgage, you’re making a mortgage loan backed by the borrower’s property. This could be anything from a shopping mall to a condominium to a church. In return, you receive regular interest payments throughout the term of the loan and repayment of principal at maturity. An underwriter such as Intercoastal serves as liaison between borrower and lender and ensures terms of the loan are satisfied.
The chief difference is most fixed-income investments are misnamed. Bond markets can be highly volatile, seesawing with interest rates and other economic factors. Mortgage investors suffer no such uncertainty. The interest rate is fixed, meaning you get a consistent rate of return – historically competitive with other fixed income investments – with measurably less risk.

Intercoastal securitizes Real property loans for the following:

• Single Family Homes
• Condominiums
• Commercial and Industrial properties
• Apartments
• Construction
• Acquisition & Development
• Equity/Profit Participation
• Churches
• Land
• Discounted Notes

An Attractive way to participate in the growth of the market and it diversifies your portfolio .......

Nearly all investors appreciate the value of diversification. We have all heard the saying, it’s not prudent to put all your eggs in one basket. The most common way to diversify is to divide your portfolio between equities (stocks) and fixed income (bonds), two asset classes that generally move in opposite directions.
Astute investors seek additional diversification by further dividing their fixed income portfolio. This is where mortgages play a critical role. While bonds are considered “fixed income,” prices vary, sometimes dramatically. However, if you place some or all of your fixed income investment in mortgages – the returns for which are truly fixed – you add an element of stability, thereby lowering the volatility of your entire portfolio.
Diversification aside, investors should not overlook the investment opportunities in the real estate market itself. It’s a large and vital aspect of any economy and no portfolio should be without it. You include real estate in your portfolio for the same reason you include energy stocks, or retail or technology. Overlooking key economic sectors will create gaps in your portfolio, resulting in missed opportunities and lowered diversification.  Mortgages are a convenient and sensible way to take advantage of the opportunities of real estate investing.
The income feature is attractive to investors also. Some choose to reinvest their income back into principal, while others welcome receiving regular interest payments in the mail.
Finally, mortgage investments are fully managed. Intercoastal handles all aspects of the process – from loan origination to payoff.
If you’d like to learn more about the many benefits of mortgage investing, please call 305-491-2018.

Before you invest in mortgages, consider whether the potential risks and rewards are consistent with your investment objectives.

Is mortgage investing right for me?
Mortgage investing is not for everyone. Minimum investment requirements will vary depending on the mortgage pool, but as a rule the entry requirements are higher than for most other investments. Ask yourself this question: Am I comfortable committing substantial assets to an investment for as long as one to three years? If you answer yes, then mortgages may be suitable for you.
What is the return potential for our mortgage pool?
We provide a rate of return of 10% annually, with monthly dividend disbursements. Most of our investors are not happy with the typical mortgage pool, where the investors are charged management fees, profit sharing commissions, and administrative costs to operate the pool.  In our mortgage pool, we pay the first 10% of revenue to the investors and any remaining profits are then paid to us for managing the mortgage investments.To compare, stocks have returned about 3.52% over the last three years (2009-2011), and 2.41% over the last 5. Bonds meanwhile have averaged 4% and 3% over the same periods.
What are the potential risks of mortgage pool investing?
No investment is entirely risk free – we want to be clear about that. In the case of mortgage pools, real estate values may fluctuate and borrowers on occasion default for any number of reasons, which may delay repayment. But a good  management team can effectively manage those risks with their strong knowledge of the market, tough underwriting policies and sound business practices.
The potential for liquidity risk should also be considered. Depending on the investment program liquidity risk is average.
Risk also varies among different types of mortgages. Intercoastal makes loans secured by first, and second mortgages. A lender holding a first mortgage is paid off first if the borrower should default and the property must be sold to satisfy the loan. Lenders in second position are paid next, and therefore face potentially more risk. But investors in second position are compensated as returns are generally higher than on a first mortgage.
How does Intercoastal manage risks?
Risk can be mitigated. A mortgage  investment is only as secure as the underlying loan, which is a function of the strength of the underwriter. As the underwriter of the loan, Intercoastal represents the investor to ensure all foreseeable potential risks of the loan are mitigated.
Our strict underwriting standards and awareness of the market are your insurance against potential risk.

Additionally the following factors are the fundamental drivers in the Intercoastal due-diligence process.

• No more than 50% to 65% loan-to-value ratios, depending on the property, which is more conservative than industry averages.
• Licensed third-party, independent appraisers who are experts in their geographic area and property type.
• A stringent due-diligence review process, including a seasoned investment committee who independently review all loans.
• Frequent site inspections performed by members of the Intercoastal team.