Capella Mortgage hard money lender in LV

[Rick S.]

I'm thinking of investing in some notes with Capella Mortgage. I know they've been around for quite a while, and I'm wondering if anyone would be willing to share their experiences they have had dealing with them, either as an investor or a borrower. They are a hard money lender in Las Vegas.

[Amy Davis]

Hi all,

I came across this older post about Capella Mortgage and thought the following would be helpful for any members considering investing with Capella based on experiences of people I closely know.

Please do a web search of “Capella Mortgage Fraud” as investors are posting about potentially fraudulent deals Capella originated. In one deal referenced the poster highlights a major potential conflict of interest as Capella supposedly used an appraisal generated by the borrowers without disclosing this to investors, who later invested $3.9M to finish a luxury home Capella claimed was 80% complete. In this deal, the borrower soon defaulted and instead of foreclosing Capella raised another $1M from investors. The home, however, is still not finished 3 years later. Investors are angry Capella earned over $100K in origination fees on that deal and claim Capella did not do adequate due diligence, disclose conflicts of interest, and acted in their borrowers interest and not the investors interest.

I know others who invested in a problem Capella loan for a golf course with water rights and multiple home lots. Capella claimed the property was worth $5.8M. Similar story as the borrowers defaulted. Now Capella says the property will likely sell for significantly less than $5.8M. This is another deal where Capella earned over $100K in origination fees, the loan quickly went bad, and now Capella principal Corrine Cordon looks to further enrich herself by buying out investor interests at a discount (offering 75 cents on the investor dollar). Those I know in this deal are elderly, unsophisticated with trust deed investing, and relied upon Capella’s supposed due diligence. These investors should not have been in this risky of a deal. I believe borrowers must do their due diligence, but this looks to be another example of Capella either not doing adequate deal due diligence/underwriting/appraisal or fraud.

Investors are now coordinating and it has become known there are multiple problematic Capella deals in default. Investors are also beginning to file formal complaints against Capella with the NV Division of Mortgage Lending and other enforcement agencies. Be careful and please do your due diligence before investing with any HML!