Aloha Capital Reviews?

[Travis Mullenix]

I am strongly considering investing into private notes with Aloha Capital. Has anyone worked with them before?  If so, how was your experience.

Thank you,

Travis

[Beth Johnson]

@Travis Mullenix

I haven't but wanted to know if you have had experience in private lending before? If not, you will want to be sure to define your own deal preferences and risk tolerance. Some hard money lenders lend at pretty high LTVs, leaving little equity buffer to protect your principal. Other KPIs and considerations you should evaluate when talking to any lender who offered private placement of loans/notes are historic default rate, how quickly they can place your funds (do you get preference over their income funds, for example), average interest rate - borrower note rate and what is passed through to you, are loans serviced by a 3rd party servicer or in house. There's a lot more but I thought I would share a few thoughts, in case you haven't had previous experiences investing with a lender.

[Travis Mullenix]

Quote from @Beth Johnson:

@Travis Mullenix

I haven't but wanted to know if you have had experience in private lending before? If not, you will want to be sure to define your own deal preferences and risk tolerance. Some hard money lenders lend at pretty high LTVs, leaving little equity buffer to protect your principal. Other KPIs and considerations you should evaluate when talking to any lender who offered private placement of loans/notes are historic default rate, how quickly they can place your funds (do you get preference over their income funds, for example), average interest rate - borrower note rate and what is passed through to you, are loans serviced by a 3rd party servicer or in house. There's a lot more but I thought I would share a few thoughts, in case you haven't had previous experiences investing with a lender.

 Beth, great information! Thank you for sharing! 

[Jay Hinrichs]

they are experienced lenders.. I know they used to sell a lot of their loans on Peer st.. now that Peer st is BK I suspect they are having to go pretty aggressively for private investors to back fill their orginations. 

[Cristina Millan]

Hi Travis, I am looking at investing with Aloha as well. Did you move forward with them? 

Thanks,

Cristina

[Bryan A. Lemos]

Quote from @Cristina Millan:

Hi Travis, I am looking at investing with Aloha as well. Did you move forward with them? 

Thanks,

Cristina

I am investing in two different partial notes with them.  I will keep you updated the best I can. Once you sign a contract of intent, they give you a portal to select from notes, and you can choose from partial notes, subordinated notes, whole notes, and protected notes. So far the process is simple.  Sales agent gets slightly more aggressive than I like, but other than that, they seem more trustworthy than other opportunities like this that I come across.   

[Jay Hinrichs]

Quote from @Bryan A. Lemos:

Quote from @Cristina Millan:

Hi Travis, I am looking at investing with Aloha as well. Did you move forward with them? 

Thanks,

Cristina

I am investing in two different partial notes with them.  I will keep you updated the best I can. Once you sign a contract of intent, they give you a portal to select from notes, and you can choose from partial notes, subordinated notes, whole notes, and protected notes. So far the process is simple.  Sales agent gets slightly more aggressive than I like, but other than that, they seem more trustworthy than other opportunities like this that I come across.   

by partials you mean fractional interest in the loan that is transferred to you via an assignment ?
Just curious. this is how I did all my loans back in the day in CA.

[Bryan A. Lemos]

They assign pro-rata shares. As it reads, a pro-rata share is "equal to the Purchase Price of Participation divided by the Outstanding Principal Balance of the Note."

I think that is what you are asking? I'm new to this, so I am unsure if I am answering your question correctly

[Jay Hinrichs]

Quote from @Bryan A. Lemos:

They assign pro-rata shares. As it reads, a pro-rata share is "equal to the Purchase Price of Participation divided by the Outstanding Principal Balance of the Note."

I think that is what you are asking? I'm new to this, so I am unsure if I am answering your question correctly

 well there is a few ways you can do that.. and Assignment gives the world notice that you own your % as its recorded at the county recorder. 

But it would be good if you understand how this is done just for your education etc.  

So when you actually assingn a pro rata interest and you were to run a title report your ownership would show up. 

[Bryan A. Lemos]

Hey Jay, Sorry...you are making me double-check my paperwork which is good...thank you. 

 Partial notes are just a partial note in the loan's yield (not the loan itself) and in most cases, a second position on the loan (both upside and downside) by contract terms with Aloha.
 Only whole notes become the 1st position and holder of the actual loan note.  

Here is their description and note site 

Their terms state: "With whole note investments, the investor transfers the complete loan amount and is the sole owner of the 1st position on the loan.

In contrast, partial note investors invest in a portion of the loan’s yield, with no single investor holding a priority position over others. Furthermore, whole note investments benefit from an additional 0.5% annualized yield and are entitled to a share of any extension fees charged to the borrower."

[Jay Hinrichs]

Quote from @Bryan A. Lemos:

Hey Jay, Sorry...you are making me double-check my paperwork which is good...thank you. 

 Partial notes are just a partial note in the loan's yield (not the loan itself) and in most cases, a second position on the loan (both upside and downside) by contract terms with Aloha.
 Only whole notes become the 1st position and holder of the actual loan note.  

Here is their description and note site 

Their terms state: "With whole note investments, the investor transfers the complete loan amount and is the sole owner of the 1st position on the loan.

In contrast, partial note investors invest in a portion of the loan’s yield, with no single investor holding a priority position over others. Furthermore, whole note investments benefit from an additional 0.5% annualized yield and are entitled to a share of any extension fees charged to the borrower."

 Interesting.. does not sound like a secured interest in the note.. kind of like how Peer st. had their partial interest done. U may want to talk to your account rep and get a clarification of this. whole notes it appears they do assign 100% interest to the investor .. and in my mind that is the safest way to do these. 

[Bryan A. Lemos]

Hey Jay, in talking to my rep, partial notes are definitely not a security or secured interest in the note. They only hold yield share.  Whole notes to be come secured interest on the actual note. 

When you say "safest way".  Can you explain how your company solves the partial note issue? 

Thx!

[Jay Hinrichs]

Quote from @Bryan A. Lemos:

Hey Jay, in talking to my rep, partial notes are definitely not a security or secured interest in the note. They only hold yield share.  Whole notes to be come secured interest on the actual note. 

When you say "safest way".  Can you explain how your company solves the partial note issue? 

Thx!

I am in a different niche we don’t do partial or fractional interests 

[David C.]

I spoke with Aloha recently, this is what I understood:

Wrt partials, you get an unsecured note from Aloha Capital, Aloha holds the sole secured interest in the loan.  Aloha is the only name that shows up in the public record as owner of the loan.

Wrt whole notes, ownership of the note and mortgage/DOT is transferred to the investor via an assignment and allonge.

I agree w/ @Jay Hinrichs, a 100% secured interest in the loan is safest.

I haven't invested with them yet, still considering.

[Sharon Porter]

I am thinking of working with Aloha Capital. Has anyone worked with them?

Thanks

Sharon

[Eric Gerakos]

My wife and I buy many “fractional” notes where we live in California. Our names go on title and our loans have the real estate as collateral so they are “secured loans.”  It sounds like Aloha Capital is selling “shares” which are not secured by real estate and would be considered “unsecured loans.” Meaning if the borrower stops making their payments the investor can lose all of their investment. I don’t know why anyone would take that risk for little reward. Hope that is helpful.