FAQs

As of January 2023, the preferred rate of return is 9%.  The funds target rate is 10%.

The fund managers, Iron Capital Partners LLC, are paid a 1.5% fee of assets under management (AUM).  The management fee of 1.5% is currently waived until January 1^st, 2025, for all new investors.

Unlike traditional investing that focuses more on credit scores, private lending that Iron Capital participates in largely relies on the collateral. We use conservative underwriting procedures and typically make sure we have at least a 35% cushion of equity.

Iron Capital typically makes short term bridge loans with a max term of 36 months.  There are many viable long-term solutions for a borrower exiting a short term loan, including selling and transferring to a traditional lending institution.

The fund is comprised of and targets mostly western united states properties with non-judicial foreclosure processes (<6 month foreclosure timeline versus 3+ years in judicial states)

$100,000 minimum investment is required.

The initial lock-up period is 12 months.  After 12 months we allow investors to redeem their shares which is paid out on a quarterly basis with 90 days’ notice.

Yes.  The fund is Evergreen.

Each investor will receive monthly dividends and statements.

Our affiliate with Hometown Equity Mortgage DBA theLender (www.theLender.com), which is a top 5 non-prime lender in the country, allows the fund to pick the very best loans to enter the fund each month. This affiliate relationship frees up the fund from having to drift to find assets from an unknown 3^rd party.

Yes.  You will receive your monthly dividend checks each month via wire or check. Once you invest, you leverage the management company’s expertise and knowledge in the business and participate in the upside of a diversified portfolio.

You must be an accredited investor to invest in the fund.  There are 2 primary ways an individual and an Entity is considered an accredited investor.

Individual

• Earnings qualification: An accredited investor most make at least $200,000 in personal income, or $300,000 for combined incomes, over the past two years, with the expectation of the same or higher income in the current year; or
• Net Worth Qualification: the individual on their own or with their spouse must have a net worth of $1,000,000. The value of the investors primary residence cannot be used to meet the minimum.

Entity

• Assets that exceed $5 million that was not formed solely for the purpose of making the investment; or
• An entity whose owners satisfy all of the above

Investors in the fund don’t own a specific note.  Instead, and one of the greatest benefits to the fund, the investors become part owner of the entire fund which diversifies each investors capital across all notes in the portfolio. In addition, due to the funds 35% equity cushion target and preference in states that have a non-judicial foreclosure process, the fund is confident it could foreclose on a non performing asset and sell it at a potential profit.

Yes. Qualified retirement money, that is self-directed, is allowed to be invested in the fund.  Don’t have a self-directed account? Not to worry. We can make an introduction to several trusted custodians that we have worked with.

Yes.  Every manager of the fund has skin in the game.  All managers intend to accumulate a meaningful investment over time.

Yes.  Being that the fund was recently formed, in December 2022, we have yet to audit any returns due to the short period of time.  We have contracted with CohnReznick, which is a top 25 accounting firm in the country for our future audits.

Yes. Investors shall make this election at time of subscription.  Whether an investor takes monthly distributions or decides to reinvest, the income will be taxed as ordinary dividend income.

The core concept of investing in a mortgage fund such as Iron Capital, is that if a borrower does not perform, the fund can foreclosure on the underlying collateral and force a sale of the property. By doing so, the fund is able to recoup its investment and as long as there is a margin between the loan amount and the property value, the fund should not lose money in a foreclosure sale.  The current weighted average LTV of Iron Capital, as of February 2023, is 63%.

The funds affiliate relationship with Hometown Equity Mortgage DBA theLender.com (“HEM”) allows the fund to maintain strict control over the valuation process. All loans originated by HEM receive full appraisals via a 3^rd party appraisal management company (AMC). All loans are also ran through Collateral Desktop Analysis (CDA). The CDA re-evaluates the entire origination appraisal, validating its integrity, not just the value. The exhaustive review extends to any misrepresentation or non-disclosure of prior transactions of both the subject and comparables.

As of March 2023, over 70% of the fund was comprised of purchase money loans while the remainder are refinances.

Primarily 1^st trust deeds.

As of January 2024, the fund has an average loan amount of $386,175

Being a new fund, currently none of Iron Capitals loans are delinquent.  However, it is expected and projected to have delinquent loans overtime, but with our prudent underwriting parameters, should not lead to losses overall.

Currently as of January 2024, our weighted average note rate is 11.73% and rates range between 9.5% and 13.00%”

Due to the affiliate relationship with HEM, the ability to scale is almost endless.  HEM has produced over $1b in non-prime assets annually since 2019 and is highly recognized as one of the best within this space.  HEM will produce far more assets than the funds balance sheet can handle with the remainder of the loans being sold to third parties on the secondary market.

The fund manager, Iron Capital Partners, is the funds master servicer of the portfolio.  All sub-servicing is performed by FCI, which was established in 1982 and is a leading national provider that services nearly $6b in loans.

Opus.  After interviewing numerous fund administrators, we chose Opus as they combine a first in class operation with best-in-class technology.  Opus was recently named “best fund administrator” by Hedgeweek.