AHP Servicing LLC offers through its website shares of its
stock under SEC Regulation A.
The company purchases distressed mortgages for a discount and attempts to modify,
settle, or refinance the loans with the homeowners before foreclosing. The
website advertises that investments have a term of 5 years and up to a 10%
return. There are not many details on the track record for this very risky type
of investment. The website does make it clear that there are no guarantees:
“NOTE: There is no guaranty that we will earn enough profit
to distribute a 10% return to Investors, or even to return their capital. The
Company will try to return to Investors all of their capital no later than the
fifth anniversary of the purchase date, assuming there is sufficient cash flow.
However, they might receive their capital sooner, later, or not at all.”
AHP
Servicing’s founder and affiliated company American Homeowner Preservation, LLC
previously offered 5 other investment opportunities: 2013C, 2013D, 2014A, and 2014B,
2015A+. The past performance section of AHP Servicing’s offering circular (page
20) indicates that that the first two programs, 2013C and 2013D, no longer hold any
third party investor’s funds. The programs had a target yield to investors of
9-12%, but that at the time of publication they had only paid back 100% of original
investment. The investors appear to have gotten their money back with no return.
The
2014A and 2014B funds are still operating with investor capital and are exempt
from submitting annual reports to the SEC. But the most recent prior program,
2015A+, has filed annual reports for 2016, 2017, and 2018. The net investment
income data for investor’s equity is buried in the financial statements' footnotes and is not impressive:
2015A+
|
2016
|
2017
|
2018
|
Equity expenses ratio
|
27.05%
|
8.52%
|
5.42%
|
Net investment income
|
1.18%
|
-2.15%
|
-.93%
|
Location, footnote
|
AHP
Servicing may help homeowners avoid foreclosure, but investors' return on capital
seems to have been limited by the high cost of servicing distressed mortgages
in American Home Preservation’s prior offerings. There is no evidence AHP
Servicing’s similar investment opportunity can do better.
Scam
|
Unsafe Investment
|
Reasonable Investment
|
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