KKR & Co. is raising its bet on high-interest, short-term home loans, the latest sign that Wall Street firms are aiming to cash in on the risky but lucrative house-flipping market.
Borrowers of residential transitional loans—or flip loans, as they are better known—use the money to buy a property, renovate it and then try to quickly resell at a profit. They have become a lucrative and growing niche of finance in recent years. Nomura Holdings Inc. estimates that flippers will borrow some $15 billion this year, nearly 25%…
GILBERT, Ariz.–(BUSINESS WIRE)–Window Rock Capital Partners, LLC, an asset management firm focused on identifying attractive investment opportunities in U.S. residential credit markets, announced that its Ventana Loan Services business has agreed to terms to obtain certain contractual rights previously used in connection with the residential mortgage conduit operated by WinWater Home Mortgage LLC. In addition, Ketan Parekh and Joseph Kohout have joined the Window Rock team. Mr. Parekh and Mr. Kohout were previously part of the management team at WinWater.
Founded in 2013, New York based WinWater’s conduit was setup to buy residential mortgage loans from a network of more than 100 originators across the United States. WinWater ceased operations in early 2016. Window Rock believes that correspondents will respond well to the ease of onboarding with Ventana given its prior relationship with WinWater.
“We look forward to introducing the Ventana mortgage conduit with our new loan programs to this correspondent network,” said Window Rock CEO and Chief Investment Officer Patrick Cardon. “In today’s environment, where there are a significant number of non-bankable borrowers, we believe that the residential credit market provides compelling opportunities for investors. Window Rock looks to acquire efficiently and aggregate assets in areas where we see the greatest opportunity for our investors.”
Cardon noted that regulation, shifting underwriting standards, and misunderstood risk have resulted in significant pricing inefficiencies involving non-agency mortgages and other segments of the residential credit market. In addition to providing direct, cost-effective access to a broad network of originators, Window Rock will obtain real-time insight into evolving conditions in the residential mortgage market through day-to-day interactions with correspondent lenders across the United States.
The WinWater contractual rights have been acquired by Ventana Loan Services, a subsidiary of Window Rock Capital Partners. Ventana Loan Services is a recently launched platform focused on originating and sourcing residential credit opportunities on behalf of Window Rock’s investment funds.
About Window Rock Capital Partners
Window Rock Capital Partners, LLC is an investment management firm focused on identifying attractive investment opportunities in the residential credit market. The firm has significant experience in underwriting and understanding borrower credit through proprietary data collections, internal systems, and processes. For more information, visit www.windowrock.com or email the company at firstname.lastname@example.org.
Minneapolis — November 9, 2015 CliftonLarsonAllen Wealth Advisors, LLC (CLA Wealth Advisors) has chosen to form a relationship with Window Rock Capital Partners, LLC (Window Rock) in an effort to capitalize on the inefficiencies in the private credit market associated with distressed residential housing. Window Rock was selected for its demonstrated skill at evaluating borrowers and the underlying residential collateral.
The relationship with Window Rock illustrates CLA Wealth Advisors’ commitment to expanding private investment options to individual and institutional clients. CLA Wealth Advisors will now have access to the experience and insight Window Rock has cultivated in this market niche, offering investment diversification from the traditional public stock and bond market.
“We’re bullish on residential housing as an asset class, and as such we sought to provide our clients with opportunities in the U.S. housing market. Sentiment is still relatively negative on the asset class, but we believe the underlying economics are very strong; those are some of the tenets we look for,” explains Tony Hallada, CEO with CLA Wealth Advisors. “We are pleased to work with Window Rock and the Cardon family. They have an excellent track record of investing in real estate cycles and they’re considered one of the premier experts in the Southwest real estate market in the United States.”
Since 2010, Window Rock has focused on distressed consumer credit through the affordable mortgage market. Using a multi-disciplinary approach, the firm offers creative repayment plans to borrowers, often including significant reductions to mortgage principal balances and monthly principal and interest payments. The result is the acquisition of undervalued cash flows and assets that can become significantly more valuable through repositioning.
“Aligning interests and partnering with the right investors is key to our success,” says Patrick Cardon, founder and managing member at Window Rock. “We pride ourselves on our creativity; we ask a lot of questions rather than simply accepting things as they appear.”
Window Rock employs proprietary technology, systems, and processes to capitalize on inefficiencies it has identified in the residential housing market. It uses a strategic approach to properly value underlying assets and purchase these assets at deep discounts. Window Rock can also originate loans to borrowers who have been ignored by traditional lending institutions.
“Credit remains tight or inaccessible for many potential borrowers, especially for those with FICO scores less than 720,” says Cardon. “Window Rock can extend credit to these misunderstood borrowers by analyzing and understanding their performance and behavior.”
Tight credit policies in the banking industry have led to increased demand for this type of service, allowing Window Rock to profit from loans to an underserved population.
This announcement is neither an offer to sell nor a solicitation of an offer to buy any securities, nor does it constitute the rendering of any investment advice to the reader. Private fund investments are offered only through an offering memorandum, which explains fully all of the implications and risks of the offering of securities to which it relates. Private investments involve a high degree of risk, including, but not limited to, a lack of liquidity and the potential loss of investment principal. There is no guarantee that the stated objectives of any private investment fund will be met. Private investment fund offerings are not filed with or reviewed by any securities regulatory agency. Past performance is no assurance of future results.
CliftonLarsonAllen Wealth Advisors, LLC (CLA Wealth Advisors), an SEC-registered investment advisor, offers wealth advisory services, including investment management; financial and retirement planning; estate, gift, and income tax planning; divorce financial planning; business succession planning; sell-side representation of mergers and acquisitions; insurance and risk management; employer-sponsored benefit plan design, compliance, and consulting; and investment consulting for endowments and foundations. The national wealth advisory practice consists of approximately 100 professionals who advise or consult on roughly $4 billion in total client assets. According to Accounting Today’s 2015 “Wealth Magnets” report, CLA Wealth Advisors is ranked sixth in the billion dollar club based on assets under management (AUM). This publication reviews wealth managers affiliated with CPA firms.
CliftonLarsonAllen Wealth Advisors, LLC is a wholly owned company of CliftonLarsonAllen LLP, a national professional services firm. For more information visit CLAconnect.com/privateclient.