Have you raised your target ROI?

Question

For those active in the performing note space, have you raised your minimum ROI or minimum interest rate to maturity calculations in the last 6 months?

Chris Seveney · Answer

On performing loans we have increased our yields we are looking for because of interest rates and risk. For most sellers, they have also increased pricing which has lowered yields. Today is an awful time to be a one off note investor and if you do not have some money behind you  - you would be better off originating.

Example: Saw someone buy a reperforming note with 15 years left at 10% yield. You could originate a HML with 2 pts and 11% right now....