CT Realty Corp. is looking to get in,and out,of a new line of business.
The Newport Beach-based real estate investor and developer and Orange-based Fasthold Capital Inc. have bought $33.5 million in troubled mortgages for about 100 homes in California, Washington and Arizona.
It’s CT Realty’s first foray into mortgages. But the move isn’t out of character for the company, said Robert Campbell, CT Realty president.
“CT’s game plan has always been to look at new markets,” said Campbell, a veteran of local commercial real estate. “We try to get in early and not stay too long. Hopefully this is a short-term business.”
The venture expects to keep the loans for two or three years, he said.
The plan is to sell some of the loans to buyers of distressed assets. In some cases, borrowers will be offered incentives for a deed-in-lieu of foreclosure, where the borrower gives up a home to forgive a loan balance.
The strategy for the rest will be to refinance or restructure, according to the company.
“We’ll arrive at conclusions quickly,” Campbell said. “Our goal is to keep people in their homes.”
Most of the homes are occupied by borrowers, with loans ranging from 45% to 100% of the homes’ values.
CT Realty said it bought the loans from an undisclosed investment bank.
Sources said the seller was New York-based Lehman Brothers Holdings Inc., which filed for bankruptcy protection last week as its mortgage and real estate investment losses ballooned.
For more on this story, read the Sept. 22 issue of the Business Journal.
