Mortgage Pool Investing 101

You may have heard about mortgage pool funds from a colleague or friend, or you may have read about the unique advantages of investing in a real estate asset backed fund like the Pacific Private Money Fund.

We understand that you may have questions about these funds operate, so here’s a high level overview of what we do.

Step 1
We pool capital from accredited investors.

Step 2
We make loans to qualified borrowers at above market rates, often for 6 to 24 month terms, and these loans are secured by real estate. These loans are made according to additional guidelines spelled out in a Private Placement Memorandum.

Step 3
Investors receive a preferred return on their investment, paid monthly.

Step 4
The fund’s managers work to achieve the highest yield possible for the fund since they are compensated on a profit-sharing basis.

Step 5
The fund’s profits, above and beyond the preferred returns paid to its investors, are distributed to the investors and managers quarterly.

Investing in a mortgage pool fund is an excellent way to diversify your portfolio, and many investors appreciate the peace of mind afforded by having their capital secured by real estate.