Oxford Funding Corporation, which is planning to raise USD100m for a fund dedicated to acquiring portfolios of home loans from banks and large mortgage lenders at generous discounts, has a
Oxford Funding Corporation, which is planning to raise USD100m for a fund dedicated to acquiring portfolios of home loans from banks and large mortgage lenders at generous discounts, has already received its first group of investors and the first segregated sub-account has been fully subscribed.
‘The company’s road show for our hedge fund was well received with major houses in New York,’ says Oxford chief executive Ron Redd. ‘We have had many investor requests for more information and we expect the fund to be fully subscribed soon.’
According to Redd, the Oxford Opportunistic Mortgage Fund ‘doesn’t just protect investors from the down market in real estate, it actually gives them a way to profit. The industry’s bad news is our good news.’
He says that as lenders sell property portfolios at steep discounts to their actual value, Oxford can hold the loans, modify them if necessary, and sell the mortgaged bricks and mortar at significant gains.
By purchasing portfolios of mortgages at discounts as high as 70 per cent, then restructuring the loans, Oxford was able to announce that the 2007 annualised return on its portfolio of loans exceeded 90 per cent.
‘Our hedge fund will provide a way for investors to profit and protect their capital,’ says Oxford Funding president Robert Dunn. ‘Freddie Mac and Fannie Mae reported a total of USD6.2bn in losses for the fourth quarter of 2007 and predict multi-billion dollar losses for 2008.’
Oxford Funding Corporation is a publicly-traded asset resolution company specialising in the purchase and management of bulk mortgage loan portfolios. The firm’s management has facilitated rehabilitated loan sales exceeding USD1bn.