Private Fund Principal Reduction Plans in Perspective: Alternative to Strategic Default or Hating-Your-House

Tampa, FL (PRWEB) June 30, 2010

It seems the only consensus regarding the housing crisis is that recovery will be slow in coming. Home values are stagnant (still falling in many areas), foreclosure numbers are increasing, and the federal governments HAMP response is widely seen as an abject failure. These factors suggest few, if any options, for responsible homeowners to recover their lost housing investments any time soon.

It would seem the only options for those still able to pay their mortgages are to continue throwing money away into an undervalued asset, or engage in what is called strategic default, likely ruining your credit and chance for homeownership in the near future. In fact, homeowners who strategically default will be ineligible for new Fannie Mae-backed mortgages (up to seven years) and will likely face court via deficiency judgments.”

There may, however, be a third option. While the Too-Big-To-Fail banks and the Federal Government continue their painfully slow response, the private sector may offer a solution to some of these forgotten families who feel stuck between two bad choices: strategic default or hating their house.

Various private equity and hedge funds have entered the fray with clear and concise plans that can result in a win/win/win scenario. Once a large portfolio of residential mortgages from a given lender is collected, the fund negotiates the purchase of that portfolio at a discount. That discount is then passed on to the homeowner via principal reduction. The lender gets a cash infusion and avoids strategic default risks. The homeowner is rescued from negative equity, and the fund is able to profit while rebuilding the securitization market at the same time.

Given that different funds target different homeowners and private funds like their privacy, programs such as this have received minimal attention. Trinity Bay Financial, Inc., an authorized affiliate of Addvent Funding, has taken the initiative to gather as much detail as possible on the topic, and offer it to the pubic at: http://bit.ly/tbfprpdata.com.

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Cadwalader Partner Drew G.L. Chapman to Moderate Hedge Fund M&A Panel at Global Hedge Fund Summit


New York, NY (PRWEB) April 18, 2011

Drew G. L. Chapman, a partner who leads the Alternative Investment Group at Cadwalader, Wickersham & Taft LLP, will be moderating a panel at the 17th Annual Global Hedge Fund Summit to be held in Bermuda, May 1-3, 2011. The conference will focus on what the future holds for the hedge fund industry. Mr. Chapman will lead a discussion entitled: Hedge Fund M&A: Where Do We Stand Now?

Mr. Chapmans practice focuses on the alternative investment, asset management, and financial services industries, to which he brings broad transactional, structuring and fund formation experience. He counsels clients on crucial and complex policy, governance and regulatory issues, investigations, litigation and adversarial situations, and on transactions of all types, including mergers, acquisitions, dispositions, spin offs and spin outs, secondary transactions and restructurings. His clients include some of the world’s most prominent financial institutions, hedge funds, private equity funds, broker-dealers, asset management firms and sovereign wealth funds.

Cadwalader, Wickersham & Taft LLP, established in 1792, is one of the world’s leading international law firms, with offices in New York, London, Charlotte, Washington, Houston, Beijing and Hong Kong. Cadwalader serves a diverse client base, including many of the world’s top financial institutions and corporations, undertaking business in more than 50 countries. The firm offers legal expertise in antitrust, banking, business fraud, corporate finance, corporate governance, energy, environmental, financial restructuring, healthcare, intellectual property, litigation, mergers and acquisitions, private equity, private wealth, real estate, regulation, securitization, structured finance, and tax. More information about Cadwalader can be found at http://www.cadwalader.com.

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