Lending Activity Points of Interest
This Points of Interest list is intended for discussion purposes, please reach out to Sierra Mortgage to discuss these items in greater detail.
• we will invest only in first or second mortgage loans (which can include inter alia first, second or third mortgage charges over more than one property) secured primarily against residential real estate, which includes single-family residences, townhouses, and apartment condominium units and multi-family rental dwelling buildings, although mortgage loans secured against raw land, commercial, industrial and other non-residential real estate uses will also be considered;
• Construction mortgage loans will be restricted to single-family residential properties;
• we will not invest in a mortgage loan unless such investment has been approved unanimously by all 3 members of the credit committee, which is currently comprised of all 3 Directors of the Company or, unanimously by no less than 2 of the 3 members if all 3 members are not available within 24 hours of the time of the loan submission. The Company may elect, from time to time, to add an additional member the Credit Committee;
• mortgage loans will be made against real estate located in established areas primarily in the Okanagan, Thompson, and Shuswap regions of British Columbia, however, investments may be extended to other established areas within British Columbia or Alberta;
• an investment in a mortgage loan will not be made unless, at the date the investment is approved by the Credit Committee, the amount secured by such mortgage investment, plus the amount owing under any prior financial charges, generally does not exceed 75.0% of the appraised value of the property or properties securing the mortgage; provided that the appraised value may be based on stated conditions including without limitation; completion, rehabilitation or lease-up of improvements located on the property or properties, which activities we will monitor on an on-going basis;
• no single investment, or related group of investments, involving one property or development, or involving several properties or developments owned or controlled, directly or indirectly by one borrower and its affiliates, will generally exceed the lesser of $600,000.00 or 15.0% of the book value of the assets of the Company;
• each and every property forming security for any mortgage loan will be inspected by at least one member of the Credit Committee or, in the event a property is located outside of our primary lending area, by an individual approved by the Credit Committee, prior to the advance of any funds;
• Once mortgage loans are secured and funded, the Company pays a management fee to the Manager of 2.0% per annum calculated and paid monthly on the average balance outstanding under the loan portfolio.
*Disclosure: This information does not constitute an offering to sell or a solicitation to buy securities referred to herein.