Here are some of the comments from our Investors 




Structure of the Fund. Competition. Environmental Issues. High Interest Rates. Licensing. Bankruptcy. Litigation. Foreclosure. Loan Participation. Leverage. U.S. Securities Laws. Regulations. Usury Laws. Conflict of Interests. Alignment. Construction Loans. Distant Geographical Locations. Diversification. Market Share. Market Collapse. Due Diligence. Lack of Cash-Flow. Underwriting. Insurance. Title Work, etc.




To us, none of the above can be described as “one of the major risks” – Why? Because most of those except for “Market Collapse” could be managed.




At Capital Insiders, we consider Fund Manager’s discipline as one of the major risks – Here is why:




If the Fund Manager losses his discipline, the underwriting guidelines might lower its lending standards, then the Manger could start making riskier loans.




If a Manger’s portfolio is composed of a well-collateralized, diverse asset-class and geographical locations, short-term loans, 70% LTV, 85% LTC, made to borrowers with strong track records, then the opportunities to navigate during challenging markets would be different. However, the danger of the Manager is competing with other lenders who are starting loosening credit standards and to extend higher leverage loans. An undisciplined Fund Manager might be tempted to follow those lenders who are getting into the race of making faster/riskier loans in order to meet the return expectations for their investors.




Manger’s strict underwriting disciplines are the backbone of the Fund, and that’s why we have previously mentioned here that some Investors might have the tendency of vetting past Fund’s results rather than making an interview and evaluating the Manger. Although vetting past results is a good start, getting to know the Fund Manager is crucial for the Fund’s performance




As Capital Managers, we keep a “security-first” mindset the permeates in everything we do, and for over two decades, it has been our commitment for capital preservation and consistent income generation to our Investors.




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Please give us a call at 956.928.1111 or email us at invest@capitalinsiders.financial




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