The FWMM Distressed Mortgage strategy is to identify select assets for sale in the multi-billion US dollar non-performing residential mortgage loan market, and successfully acquire targeted loan investments at appropriate risk-adjusted discount prices that allow the firm to utilize its resolution management expertise.
The core of the Firm’s strategy centers on its acquisition evaluation process.
FWMM has created a meticulous investment policy that outlines the Firm’s acceptable sourcing options, eligible assets, due diligence requirements and guidelines, as well as key contractual terms the Firm is willing to accept. In addition to its methodical investment guidelines, the Firm also employs a robust proprietary acquisition evaluation model that allows FWMM to thoroughly assess each investment consideration’s risk/reward proposition quickly and efficiently.
Since FWMM Inc. invests in distressed mortgage loans, there are a number of resolution options the Firm deploys to actively manage non-performing assets to obtain the best possible economic outcome:
Loss Mitigation Activities
These range from short sales, deed-in-lieu of foreclosure, foreclosure proceedings, and bankruptcy management. Each option is selected based on each individual loan’s specific status, and the best use of resources is undertaken.
Loan Modification
In certain instances, it may be possible to modify the terms of the non-performing loan so that it may turn into a cash-flowing asset, which could garner higher return possibilities and more revenue/disposition options
Loan Sale
Depending on market conditions, and successful servicing decisions and execution, acquired loan assets may at times be valued higher by other market participants than what FWMM may be valuing the asset itself. In this case, FWMM would have the option to sell or hold the particular asset, depending on which alternative provides the most economic resolution.