American Homeowner Preservation (AHP) Fund
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Investor · Kingston, WA · Member since 2008 · 1k+ posts · 1k+ votes
6yThe virus has impacted a fund like AHP mostly in administrative delays with foreclosing on properties and getting them converted to REO properties for resale. One large component of their business model is to acquire distressed mortgage debt then foreclose and resell the property as REO on the open market.
Due to moratoriums on both foreclosures and evictions, as I understand it, AHP is essentially experiencing a log jam on the back end of their exit cycle to recover investor capital and profit.
They've recently introduced a program called "pre REO" which gives them a strategy to help pull investment capital from these assets which are waiting for foreclosure and exit so that they can recover some of the investment capital from the assets to meet redemption and capitalization requirements for the fund.
It's an innovative program, but seems like an over-complicated solution rather than just waiting for the moratoriums to be lifted and proceed was foreclosures and evictions. Even when the moratoriums are lifted there's going to be a backlog for scheduling especially in judicial states so exits on these assets will be much longer than anticipated.
I suspect AHP has most of its investors capital deployed into these type of assets and now it's jumping through major hoops to meet their capital requirements. This may be why many of you are experiencing delays in redemptions and distributions.
In the fund which I co-manage, we've stopped foreclosure activity on many of the non-performing assets since it doesn't make sense to pay our legal resources for activities that are in moratorium. We've also postponed any new capital raising activities since deploying new subscriber capital into distressed assets that we cannot resolve quickly does not make sense.
This virus has definitely forced distressed-debt managers to become more creative and patient in a market that they cannot effectively control.
384 Replies
- Member since 2024 · 5 posts · 9 votes2y
Here is a link to AHP's Motion for Temporary Restraining Order v. Land Home Financial Services seeking an "order enjoining Land Home from continuing as 'servicer' of loans held by AHP Entities, or previously held by AHP Entities but subsequently transferred pursuant to abused and now-revoked powers of attorney." The Motion states that "Land Home has participated in the improper conveyance of the AHP Entities' assets to Land Home affiliates, converted assets belonging to the AHP Entities, and neglected loans resulting in diminution of value, lost proceeds, and adverse judgments. Land Home took such actions or inactions while feigning to fulfill its duties and obligations as 'loan servicer' for various mortgage loans located throughout the United States."
https://ahpservicing.com/AHP_Motion_for_TRO_v._Land_Home.pdf - 2yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Quote from @Jorge Newbery:
Here is a link to AHP's Motion for Temporary Restraining Order v. Land Home Financial Services seeking an "order enjoining Land Home from continuing as 'servicer' of loans held by AHP Entities, or previously held by AHP Entities but subsequently transferred pursuant to abused and now-revoked powers of attorney." The Motion states that "Land Home has participated in the improper conveyance of the AHP Entities' assets to Land Home affiliates, converted assets belonging to the AHP Entities, and neglected loans resulting in diminution of value, lost proceeds, and adverse judgments. Land Home took such actions or inactions while feigning to fulfill its duties and obligations as 'loan servicer' for various mortgage loans located throughout the United States."
https://ahpservicing.com/AHP_Motion_for_TRO_v._Land_Home.pdfI hope you prevail in this motion.. Best of luck with it.. Although sounds like some major damage has already been done.. having been in the note business ( private notes) I would personally never hire a servicer we handle all our own collections and servicing.. I know or I think I know with your kind of loans your forced to go to licensed 3rd party servicers.. Keep in mind I am servicing my own HML s
PS Its great you come on here and communicate so the rumor mill does not go wild.
- Member since 2024 · 5 posts · 9 votes2y
Here is a link to AHP's Motion for Temporary Restraining Order v. Oak Harbor Capital LLC, Atlantica, LLC and Cymbidium Restoration Trust seeking an order that:"1. Cymbidium is ordered to provide an accounting of the Trust Assets transferred, serviced, and monies collected by Cymbidium, and its affiliates to determine whether or to what extent Cymbidium and its affiliates Oak Harbor and Atlantica are still owed money under the MLSA and First Amendment.
2. Oak Harbor and Atlantica are hereby enjoined from transferring Trust Assets out of the Trusts and to their affiliates."
The Motion further states that "Since the limitations of the powers of attorney did not prevent abuse and the revocation of the LPOAs failed to cease transfers, AHP Entities know of no other means to stop the unlawful transfer of assets short of a court order."
https://ahpservicing.com/AHP_Motion_for_TRO_v._Oak_Harbor_Capital.pdf (the document is 1,306 pages because it includes copies of many of the assignments executed with abused and/or revoked LPOAs)
- Ridgefield, CT · Member since 2017 · 101 posts · 60 votes2y
Is there any chance we get any equity back on our investment.??
- Rental Property Investor · Malvern, PA · Member since 2016 · 1k+ posts · 938 votes2y
@Andrew Frishman It will all hinge on the outcome of the lawsuits or settlements. I would be shocked if there was 0% return of equity and very pleasantly surprised if it was 100% consider the legal costs to be incurred. I am just speculating.
The information above regarding the filings is the only real information available right now. We just have to follow along.
- Ridgefield, CT · Member since 2017 · 101 posts · 60 votes2y
Anyone get any updates information regarding AHP lawsuits??
- Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes2y
@Andrew Frishman
For the case in washington the last docket report in pacer noted below
Note this is only case in washington state not the case in Illinois which has an extension for joint party report.
ORDER SETTING TRIAL DATE AND RELATED DATES by Judge Jamal N Whitehead. Length of Trial: 5 days. Bench Trial is set for 6/9/2025 at 09:00 AM in Courtroom 16106 before Judge Jamal N Whitehead. Joinder of Parties due by 5/10/2024, Amended Pleadings due by 11/12/2024, Expert Witness Disclosure/Reports under FRCP 26(a)(2) due by 11/12/2024, Discovery Motions due by 12/11/2024, Discovery completed by 1/10/2025, Dispositive motions due by 2/10/2025, Attorney settlement conference to be held by 4/10/2025, Motions in Limine due by 4/30/2025, Deposition Designations due by 5/19/2025, Pretrial Order due by 5/19/2025, Trial briefs to be submitted by 5/27/2025, Pretrial Conference set for 6/2/2025 at 01:30 PM in Courtroom 16106 before Judge Jamal N Whitehead. (GC) (Entered: 03/11/2024)
7e investments53 Reviews - Investor · Member since 2023 · 5 posts · 4 votes2y
Back to the immediate fire drill - any possibility of getting 2023 K1s for ahp2015+ and ahp servicing in the next few days?
- Member since 2019 · 26 posts · 10 votes2y
Guys I don't think were ever getting a dime back. I think this whole lawsuit thing is a distraction to cover up what's really going on.. If I owed 60 million to investors I would be out front causing a distraction as well. I just hope for this ride to be over and hopefully try to recoup some of our money through the tax code. I've done research and know some people in the same industry as Jorge and here's what I've found and/or been told by reliable sources.
1. AHP Servicing never filed their 2022 Audit.2. AHP Servicing closed their servicing arm and never provided an update in a SEC filing.
3. AHP servicing assets (investor money) was allegedly used as collateral for other affiliated entities controlled by the sponsor which are now tied up in litigation. (If this is the case, that is really really really bad).
4. In reading the files in the case, there appears to be a dispute between Oak Harbor and AHP where AHP was to buy back loans and never did. What is transpiring now is clearly disputed on who has rights to what assets.
5. if you read everything in the SEC and their 1-SA and financials, if you see how much they paid in salaries/bonuses you would vomit. I invested in another servicing company and the payroll for the company that was smaller but not drastically as AHP was around $800k, I believe AHP was $6M... That's a lot of salary and bonuses....
My questions are....?
- For the loans sold to Oak Harbor, which entities were those loans from?
- Were AHP Servicing and its investors funds/assets used as collateral for loans from affiliated entities?
- Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes2y
Quote from @Jason Monaco:
Guys I don't think were ever getting a dime back. I think this whole lawsuit thing is a distraction to cover up what's really going on.. If I owed 60 million to investors I would be out front causing a distraction as well. I just hope for this ride to be over and hopefully try to recoup some of our money through the tax code. I've done research and know some people in the same industry as Jorge and here's what I've found and/or been told by reliable sources.
1. AHP Servicing never filed their 2022 Audit.2. AHP Servicing closed their servicing arm and never provided an update in a SEC filing.
3. AHP servicing assets (investor money) was allegedly used as collateral for other affiliated entities controlled by the sponsor which are now tied up in litigation. (If this is the case, that is really really really bad).
4. In reading the files in the case, there appears to be a dispute between Oak Harbor and AHP where AHP was to buy back loans and never did. What is transpiring now is clearly disputed on who has rights to what assets.
5. if you read everything in the SEC and their 1-SA and financials, if you see how much they paid in salaries/bonuses you would vomit. I invested in another servicing company and the payroll for the company that was smaller but not drastically as AHP was around $800k, I believe AHP was $6M... That's a lot of salary and bonuses....
My questions are....?
- For the loans sold to Oak Harbor, which entities were those loans from?
- Were AHP Servicing and its investors funds/assets used as collateral for loans from affiliated entities?
Jason
For those who are investors and wish to follow the case, you can go to PACER and sign up for a free account. Both the illinois case filed by AHP and Washington case filed by Oak Harbor are on the website. This is a great source for information on the status of the cases.
PACER – Case Search Only | PACER: Federal Court Records (uscourts.gov)7e investments53 Reviews cymbidium-restoration-tr-v-AHP
Case text above.
https://dfpi.ca.gov/enf-a/ahp-servicing-llc/
Indicated all AHP Servicing licenses has been revoked, this is issued by federal government. This was NEVER disclosed to investors!
Also, AHP claims they have no $, so they are unable to pay their vendors, including their CPA. So unlikely to even get a K1 form this year since no one will work with them when they can't pay their bills.
https://www.law360.com/cases/6598a12377be790224df4fbf/articl...
apparently, there's more to the story then what AHP claims...
- January 16, 2024
Mortgage Co. Chief Seeks Toss Of Nonperforming Loan Suit
The CEO and manager of multiple mortgage loan servicing companies urged a Washington federal court to throw out a lawsuit accusing the companies of selling a portfolio of loans that weren't outstanding, arguing that the presiding court lacks personal jurisdiction, in part because he's an Illinois resident.
- January 08, 2024
Mortgage Servicer Sold Off Paid-Up Loans, Trust Claims
An affiliate of Seattle investment firm Oak Harbor Capital claims in a suit removed to Washington federal court that it is owed at least $2 million after a Chicago loan servicer sold it a group of 200 mostly nonperforming loans that it had already cashed out, among other breaches of a mortgage sale agreement between the parties.
- January 08, 2024
- January 16, 2024
- 2yDon KonipolBusiness MemberInvestor · The Woodlands TX / Avon, CT · Member since 2009 · 6k+ posts · 10k+ votes
There are many investors that look at promises ROI or interest rate and nothing more. About 15years ago I got a call from an investor in one of my funds that told me he from now on was going to put his money into a new fund he found paying 44% interest while my fund paid 13.5%. When I checked it out the fund he spoke of was making unsecured working capital loans to businesses with no credit. Unsurprisingly a year later he had lost 60% of his investment. "Blinded by the light…"
- 2yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Quote from @Don Konipol:
There are many investors that look at promises ROI or interest rate and nothing more. About 15years ago I got a call from an investor in one of my funds that told me he from now on was going to put his money into a new fund he found paying 44% interest while my fund paid 13.5%. When I checked it out the fund he spoke of was making unsecured working capital loans to businesses with no credit. Unsurprisingly a year later he had lost 60% of his investment. "Blinded by the light…"
also reminds me of an Australian investor who had come to see one of my clients turn keys in Birmingham that paid a respectable 9 or 10% COC etc.. And the investor said Why would i do that I can get 20 or 30% in Detroit with no clue as to risk. I have fund many deals over the years were the sellers were Aussie or their superannation funds ( Aussie retirement funds) and props were being sold for 10 to 20 cents on the dollar to my clients. - Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes2y
@Don Konipol
Reminds me of an investor who came to us and was like “you give 10% per year with your fund, I can invest with a company called drive planning and they pay 10% per quarter which is 40% annual, why should we invest with you”
Yep too good to be true it probably is….
7e investments53 Reviews - The sad part is AHP was only paying 9-10%. And they took non-accredited investors who invested large part of their net worth and was never informed of the risky business decision made by the operator!
Quote from @Jay Hinrichs:
Quote from @Don Konipol:
There are many investors that look at promises ROI or interest rate and nothing more. About 15years ago I got a call from an investor in one of my funds that told me he from now on was going to put his money into a new fund he found paying 44% interest while my fund paid 13.5%. When I checked it out the fund he spoke of was making unsecured working capital loans to businesses with no credit. Unsurprisingly a year later he had lost 60% of his investment. "Blinded by the light…"
also reminds me of an Australian investor who had come to see one of my clients turn keys in Birmingham that paid a respectable 9 or 10% COC etc.. And the investor said Why would i do that I can get 20 or 30% in Detroit with no clue as to risk. I have fund many deals over the years were the sellers were Aussie or their superannation funds ( Aussie retirement funds) and props were being sold for 10 to 20 cents on the dollar to my clients. On the last webinar, we heard about a fund for legal fees, which would be starting up in a couple weeks (March 20). It was supposed to offer something like a 15% return, but obviously would pay nothing if no money was recovered.
- 2yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Quote from @Paul B.:
On the last webinar, we heard about a fund for legal fees, which would be starting up in a couple weeks (March 20). It was supposed to offer something like a 15% return, but obviously would pay nothing if no money was recovered.
that seems like high risk to me. or throwing good money after bad.. Of course i have no clue as to what has really happened but it sounds like a massive mess and those usually do not end well for limited partners who have no control.. And as usual lawyers make out very well. Not their fault of course its the bizz they are in everyone has to get paid for their time. - Member since 2024 · 3 posts · 2 votes2y
Anyone know anything about K1s for AHP? I'm guessing at this point we shouldn't expect them anytime soon.
- Member since 2019 · 26 posts · 10 votes2y
Quote from @Eddie King:
Anyone know anything about K1s for AHP? I'm guessing at this point we shouldn't expect them anytime soon.
I talked to Sean at AHP. he said Jorge was uploading them last Friday, then it was Monday, then it was Tuesday, Wednesday, Thursday, etc. He'll tell you anything you want to hear just to kick the can down the road. I have no idea what to expect at this point.
- Member since 2024 · 3 posts · 2 votes2y
Quote from @Jason Monaco:
Quote from @Eddie King:
Anyone know anything about K1s for AHP? I'm guessing at this point we shouldn't expect them anytime soon.
I talked to Sean at AHP. he said Jorge was uploading them last Friday, then it was Monday, then it was Tuesday, Wednesday, Thursday, etc. He'll tell you anything you want to hear just to kick the can down the road. I have no idea what to expect at this point.
Jason - basically the same story to me...
Quote from @Jason Monaco:
Quote from @Eddie King:
Anyone know anything about K1s for AHP? I'm guessing at this point we shouldn't expect them anytime soon.
I talked to Sean at AHP. he said Jorge was uploading them last Friday, then it was Monday, then it was Tuesday, Wednesday, Thursday, etc. He'll tell you anything you want to hear just to kick the can down the road. I have no idea what to expect at this point.
Last year (before sh*t really hit the fan), there were monthly webinars. I swear there were at least two webinars (a month apart) where K-1s were coming "next week." We did eventually get them, but again, things were still looking okay last year.
- Member since 2024 · 3 posts · 2 votes2y
Just saw a few mins ago K1 was uploaded to online portal!
Quote from @Eddie King:
Just saw a few mins ago K1 was uploaded to online portal!
Yup confirmed. K1 in online portal.- Member since 2020 · 1 post · 1 vote2y
and we get one more year before we talk about AHP K1 again.
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