Lending Opportunities in
Distressed Real Estate
• This summary and analysis does not constitute an offer or sale of
securities but is merely a solicitation of interest in Boomerang
Capital Partners, LLC and its affiliated entities.
• Securities may not be offered or sold in the United States absent
registration or exemption from registration under the US Securities
Act of 1933.
• The offer or sale of any securities of any entity affiliated with
Boomerang Capital Partners, LLC will only be made by means of
formal offering documentation that complies with all applicable
federal and state securities laws and consists of definitive
• High Demand. There is strong demand for high interest rate
loans to investors for the acquisition of foreclosed homes
purchased at auctions in the metro Phoenix area.
• Excellent Liquidity. Short term loans create a higher than normal
liquidity rate in real estate and reduce many long-term risk factors.
Most loans are paid back in less than 75 days.
• Conservative Terms. Borrowers are willing to contribute
substantial equity at conservative valuations for short-term loans
which greatly reduces the risk of default.
• Expected Returns. Due to prepaid interest, high annual interest
rate, and transaction costs we expect gross IRR to range between
20% and 25%.
• Loan Amount. The lending ratios range between:
– 70% - 80% Loan to Cost.
– 60% Loan to Value.
• Transaction Costs. Borrower pays $500-$1,000 in loan
preparation fees at closing.
• Terms. Loans are made for 6 months with at least 1 month of
prepaid interest. Extensions may be offered for additional fees.
• Interest Rate. Our rates range from 17% - 19% per annum
depending on loan size.
• Cross Collateralization. We require borrowers to cross
collateralize all assets where we are the lender.
• Low Loan-to-Cost. All loans require 20%-30% down from the
borrower. We expect to never exceed 60% LTV.
• Senior Lien. We will always be in first recorded lien position on
the deed of trust, and disallow any subordinate debt.
• Cross Collateralization. If a borrower defaults on one loan then
all loans for that borrower are considered to be in default.
• Personal Guarantee. We require borrowers to sign a personal
guarantee to further secure our note.
• Lender’s Insurance. A lender’s insurance policy is available at
the time the Trustee’s Deed is recorded.
• Worst Case Scenario. If the borrower defaults on the loan all
collateral will be taken back via foreclosure.
• Investment Offering. Boomerang is raising up to $10 million in
equity to invest in this strategy.
• Accredited Investors. This investment opportunity is being
offered only to accredited investors.
• No Management Fee. Boomerang Capital Partners will not take
a management fee, but will participate in profits only.
• Profit Split. Lending profits will be split 70/30 in favor of the
investor. Profits will be calculated only upon payoff of each loan.
• Distributions. Distributions will be made annually or upon
request with 90 days notice, or when funds become available.
• Target Gross IRR. The investment has a target gross IRR
between 20% and 25%.
Current Portfolio Summary
as of 4/30/2010 .
• Average Gross IRR. Actual closed loans are averaging 24.4%.
• Average Net IRR. Closed loans are averaging 16.5% to investors.
• Repeat Borrowers. We are averaging 1.6 loans per borrower.
• Performing Loans. 100% of all loans are in good standing.
• Default Rate. The expected default rate for all current loans is 0%.
• Payback period. The average payback period to date is 58 days.
• Excess Demand. Loan demand exceeds available capital by 4x.
Boomerang JD, LLC Loans executed by
John Doe – 100% Boomerang JD, LLC
John Doe Owner and serviced by
Boomerang Capital Boomerang Capital
Partners – Manager Partners
Boomerang Capital Interest payments and
Partners invoices payoffs received into
Boomerang JD for Boomerang JD, LLC
services rendered account
Market Outlook .
• Volume. Homes sold at auction in Phoenix will remain high
through 2012 due to higher than average negative equity.
• Foreclosure Pricing. Prices paid at auction are driven by
investors with a 3-4 month flip timeframe, keeping prices low.
• Current Resale Pricing. Recent sales data supports the
assumption that home prices under $300k have bottomed out.
• Future Resale Pricing. A very slow turnaround is expected.
Analysts suspect little to no appreciation for the next 5 years.
Boomerang Capital Partners
Director of Capital Investments
Boomerang Capital Partners