Parker Mortgage primarily acts as a correspondent for its lender principals. In essence, we provide procurement, underwriting and servicing expertise in return for the long-term privilege of representing our lenders. We also broker some of our larger commercial real estate loans to banks and insurance companies.
As part of their balanced portfolios, our lenders recognize the value of obtaining a consistently high yield, with monthly income, on investments that are secured by a tangible asset—real property. Unlike stocks and bonds, mortgages need not be marked to market at the end of each year. For some charitable endowments, direct investments in the communities they serve (which can be accomplished anonymously) are seen as a collateral benefit.
"Each loan is tailored to be mutually beneficial for our client and the borrower"
While each transaction varies, interest rates obtained for our clients are usually about .5% to 1% above those charged by banks. Depending upon the property and the special circumstances of the borrower, loan terms typically range from five (most often) to ten years. Loan-to-value ratios seldom exceed 50%.
The approval process varies from client to client, but it is quite straightforward. After Parker Mortgage has made a preliminary review of what appears to be a promising opportunity, we contact our client's investment manager by telephone to seek an expression of interest and terms. If the proposed terms of the transaction are acceptable to the borrower, we move forward with the underwriting process. We then provide our client's management with an executive summary and supporting data, as may be required, for investment committee action.
Upon completion of our underwriting process, we provide our client with a complete submission with supporting documentation. Upon final review and approval, our client executes escrow instructions and wire transfers the loan proceeds directly to the title company holding escrow and issuing title insurance.
After the loan has recorded, we forward the original note, deed of trust, title policy and fire insurance policy to our clients for safekeeping. We collect and account for all monthly installments, which are forwarded directly to the lender. We also monitor the maintenance of fire insurance and property taxes.
From time to time we fractionalize loans for two to four lenders who hold title to a loan in each of their names. Parker Mortgage neither operates nor supports the concept of blind mortgage pools.