Non-performing note workouts
The CEO Fund acquires discounted non-performing notes and drives resolution through modification, reinstatement, or foreclosure. The underlying real estate is the recovery.
Buy deep, resolve rigorously
Non-performing notes trade at a deeper discount because the borrower has stopped paying. The CEO Fund underwrites the property, the equity position, and the workout path before we bid.
Case example: a $200,000 property with a $63,000 unpaid balance. Purchase price $47,100. Best case profit modeled at $76,450, worst case $7,950, resolved in 67 days for a 92 percent annualized return on that position.
Position specs
- Lien position: first only
- Discount driver: default status and equity in the collateral
- Resolution paths: modification, reinstatement, discounted payoff, or foreclosure
- Recovery security: the underlying real estate
Three paths, one goal
Modify and reinstate
Restructure the payment so the borrower keeps the home and the note performs.
Discounted payoff
Accept a lump sum below face value when the borrower can refinance or sell.
Foreclosure and recovery
Take the property when other paths fail, then sell at market.
Allocate into non-performing workouts
Discounted paper, real estate secured, resolved by an experienced fund team.