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Achieve Wealth Through Value Add Real Estate Investing Podcast

Mar 31, 2020

James: Hi audience and listeners This is James Kandasamy from "Achieve Wealth Through Value Add Real Estate Investing Podcast". Today we have Jim Maffuccio, who is co-founder and CIO of Aspen funds. Jim specializes in notes buying, which is a new topic for me. And I think for a lot of you, who has been following us on the commercial real estate aspect of the real estate business. Hey, Jim, welcome to the show.
Jim: Hi, James, great to be here with you. 
James: Good to have you here too. So, tell me about, let me make sure I understand notes, right. So, notes are basically that on real estate, right? It's not really the equity side of it, but the bad side of it, right. So, take it from there, tell us, tell our audience a little bit more about how does notes. like from people like you play a function in a real estate business? 
Jim: Yeah, well, you know, almost all real estate transactions, and holdings involve debt. You know, a small percentage of properties are owned free and clear without debt, but most properties do have debt. Our focus, our business focus is on residential debt. So this would be, quite simply just the mortgage that people have on their homes, somebody owns that mortgage, somebody has that receivable. Those payments are being made to somebody, they're usually paid through a loan servicer. And the investor behind that servicer who actually owns the paper most people never know the names of but we are one of those entities that actually own the note.
So, you know, there's two parties, well, basically two basic parties to a loan, there's the lender and there's the borrower or simply the lender, and we are not loan originators, we did not originate this paper, but we actually purchase, we purchased the banks position, if you will, the lenders position and you know, usually we have two different aspects to our business model. One is we buy non-performing loans. So, this is where a homeowner stops making payments on their mortgage. And the institution who owns that loan and the servicer who services that loan, throw their hands up and say, we don't know what to do it this. It's not our business model. We don't want to foreclose and take properties necessarily.
So, this is real general, obviously, they do foreclose. So, we come behind and we purchase this loan, we purchased the put it so. So, if the loan balance is $100,000, let's say it's a first lien, we can purchase that loan for maybe $50,000, but the borrower still owes 100. So, now we go to work trying to get that borrower to resume making payments or we modify the loan to make an affordable payment for the borrower. And if the borrower can't or won't work with us, then we do exercise our rights against the collateral and we foreclose and that gives us the right to take the property, because the borrower hasn't met their obligation, that's really simple terms. So yeah, I'll just let you lead me with questions.
James: I have a lot of questions based on how--
Jim: I bet. 
James: So, let me understand. So, because I think a lot of people do not know this side of the business, it's very critical that I make sure everybody understand. So, if I buy a rental property, there's a lot of hard money lenders. And then I mean, this has nothing to do with hard money lenders, but I think this is the long term loan that Fannie and Freddie give to a servicer, right? And then, I mean you don't buy that kind of loans, I guess right? So, you don't get any more, I think you look for a bank, because, the bank right now, I think they want to clear their book because some of the loan is not really performing, they do not want to have in their books. Now, if they fit, they call Aspen funds and let them buy this right? And they sell it to you at deep discount, I guess. 
Jim: That's right, we don't buy real hard money loans in general, we have done some of that, we've done some fix and flip lending on our income side of our business because we also have passive investment funds where we purchase re performing loans, where these are loans now that we're in trouble at one point in time in either ourselves or somebody else has done a workout with the borrower. Now the borrower is back on track making some sort of payments on that loan. And we actually have income funds where we buy those income streams and then pass the coupon payment off to our investors and we make a management fee for managing that work. We're consistently growing that portfolio, tomorrow it's the less active, it's the more passive model in our business but back on the other side, yeah, we're buying non-performing loans and we are buying mostly institution originated paper.
So, as you said, James, it would be, you know, Wells Fargo, Citibank, Nation star, these would be the names of servicers, but it's this kind of paper off when our particular specialty and this is maybe going a little bit deeper into this than you care to, but we actually have been specialized in buying second mortgages or junior liens. So, this would be where somebody maybe bought a house and they took out a first maybe they bought a $200,000 house and took out a first for 80% of that 160,000 and then later they refight or they took out a second, or they got a purchase money home equity line, and maybe that balance is $40,000 on that loan. And those loans when they stop performing the institutions, they charge those off after like 90 days, they're not treated the same as a 30-year mortgage would be by the institution.
So, it creates a tremendous opportunity for us because we purchase those on a you know, literally anywhere from two percent of what's owed to 60% of what's owed, depending on how much equity there is above the senior mortgage. And depending on whether the senior mortgage is still performing, the vast majority of the loans, the second mortgages we buy, will be behind a first mortgage that is still performing. So, the homeowner is making their payments on the big loan, the senior loan, but they stopped making payments on the second loan. So, we pick these up at a deep discount, and then we go to work with the borrowers and try to get them into an affordable pay plan, and back to having some equity in their property. We've been very successful at keeping people in their homes and creating an affordable payment structure and still making a good profit for investors doing that. 
James: Got it. So, that's really good on the junior, on the second loan, right? But I want to come back to the first loan or the fundamental concepts first, right. So, the economy is doing very well, right. If someone is not servicing their loan, right now, right, why not the bank forecloses on it and sell off the property, rather than selling it to you at a deep discount? 
Jim: Yeah. And so, as far as the first liens go, as you know, right now, foreclosure rates are very low historically. I mean, we went through the end of the 2008 mortgage crisis, if you want to pin a date to it, the subsequent three to four years, there was a glut of these non performing mortgages, the institutions basically had to do whatever they could do to get these assets off of their books. By the time they took properties all the way through to foreclosure, the regulators are breathing down their back, their balance sheets look terrible. So, they started moving upstream and selling the non-performing loans simply to get them off their books. And of course, they got all the bailout funds and all of that that we know about and have read about. So, there was a period of time where there was a large inventory of these non performing senior liens, now things have settled down from that.
So there is still a good amount of those that trade in the secondary market. There has always been I mean; this business model has been going on forever because I think I heard a number the other day that historically 4% of all residential mortgages are in default at all times. And that number might have spiked up to seven or 8% during the thick of the mortgage crisis. But I mean, that means that you know, 92 to 93% of all mortgages, were still being paid by the borrower. So, you know, a doubling of the defaults is, it was a big number and it created an opportunity for a lot of people to jump into the space and like ourselves, only we just decided to jump into the junior liens because there was less people, you know, interested in that. It sounded risky, it sounded like why would you want to do that, until we started looking at what the numbers look like and the leverage that we get. So, there's not as many senior liens available now, the pricing has gotten to where it's pretty competitive, you have to really know what you're doing to buy senior liens and make it work for you because, you have to beat the clock so to speak, because the margins are a little bit stronger. 

James: Okay, so, to recap, there's not much, the normal loan is available nowadays, because economy's doing well, the percentage of it is too low and the banks are not really, I mean, they have many ways to get rid of the load rather than just selling it to you, but you have been focusing on the second lien where people sometimes take double loan, I guess, right on top of one loan, they take another loan, and--
Jim: That's right. 
James: And, that's what you call a junior loan? 
Jim: Junior lien, a second mortgage, a home equity line, there's all kinds of names, but, yeah.
James: Where do they sell these? I mean, how do you know about it? 
Jim: Well, you know, really, I started going to conferences within this industry and you know, the mortgage industry, there's always been large players in it, but it's kind of a niche for small entrepreneurial investors like ourselves. We're not a pretty entrepreneurial firm, I've been in real estate related in the industry for self employed full time for 33 years now. So, I just go to a lot of conferences, I like to learn, so, I like to learn real time. So, I'd listen to podcasts, watch webinars and go to conferences.
And I heard a gentleman talking about the junior liens at a conference, and he was in a little breakout room and there was only about a dozen people in there, because everybody else was in the main hall listening to how to buy senior liens, how to buy the first you know, and I heard him talking about secondly, and immediately I got it, the light came on for me and I said this is where I want to enter the space, because I understood it and I understood the leverage and I understood that the price points and so, I jumped into this niche and where we buy them is from other people that are in our world, I mean that have relationships with banks. We've bought some stuff direct from banks, we buy most of our paper through read traders, larger hedge funds, that don't know what to do with the seconds, they don't want them necessarily. So, truly in this space, one man's trash is another man's treasure, that adage holds true. We've just developed a core competency and a skill set to be able to buy, to know what to pay for these second liens and know how to do these workouts with borrowers. And it's been very lucrative for us, and it's been very helpful to the homeowners as well. 
James: Got it. So okay, so interesting. So second lien the problem is they can't really foreclose on the deal, right, because now they are not the first in line, right. 
Jim: Yeah, and actually that's misunderstanding right there, is exactly that part of what created the opportunity for us, because for some reason people are under the impression that you cannot foreclose from second position. And of course, you can, you know, any lender, any real estate lender, the collateral, the security for your loan, what's motivating you to make the loan is not only the borrower's ability to pay, but in the likely in the event that the borrower cannot pay, you have to be able to exercise your rights against the collateral. And so of course, a junior lien, it's a lien, it's a lien on the property and we have all of the rights of any other lien holder, of a first lien holder. It's a little bit different in that, if I foreclose from second position, typically there's some exceptions to this. But typically, if nobody comes in bids at the courthouse steps for my second lien position, I end up with the property, I get title to the property, but the first lien is still in place. So in a sense, I've just bought the property subject to the first.
James: Got it.
Jim: You, follow me. So, the first doesn't go away if I foreclose. Now, in some states, the first will then, you know, they'll trigger their acceleration clause and say you now owe us, you have to pay off the first as well. But in most cases, if we foreclose from second, we end up owning the property with the first mortgage still in place. Now, I want to say this upfront, our goal, our business model is not to foreclose on properties, we've actually had to do that less than 2% of the time over thousands of transactions. And there's even been cases where we've foreclosed and we've turned around, and we've unwind the foreclosure and recast a new agreement with the borrower to keep them in the property. So it's not our game, but we absolutely have the right to foreclose from second lien position.
 James: So on the second lien, you’re basically the game that you get when you take over the property, you basically wipe out the equity from the original owner of the lien, of the of the loan, I guess, right and then you get 20, 30% off of the property, right? 
Jim: Well, it's kind of I mean, whoever, let's say whoever held the paper before us, whoever, let's say it's a just for simple numbers, let's say it's $100,000 loan, and if we buy that loan for, you know, $25,000 we still own an IOU from the borrower for $100,000. The borrower still owes us $100,000, the bank or the originator or whoever we bought that loan from, they're out of the picture. They're gone. they assign their rights to us. They do an assignment of mortgage to us, they endorsed the note, promissory note over to us and now we are the new lender per se.
Okay, so the borrower's equity is what is at stake and so, if the borrower has equity above our loan or above what we're willing to settle the loan for, then we have, you know, then we have a good position to go to the borrower and say, hey, let's work something out here, we really don't want your property. And they sometimes will say, yeah, but I don't have any equity in my property. Now, we really would like to stay, but we can't afford it. Well, what they don't know until we get talking to them is, look, we have a whole lot of room to help you to work with you. It's $100,000 loan, but if we can recast that loan, this is just an example, if we can modify that loan and get them on a payment program. And over time, say we forgive some of the principal that they owe to where maybe now they only owe $70,000. Well, that 30,000 goes right back into their equity or towards their equity in the property.
Now they're incentivized to make the payments on the second, so we look at their finances. We have a pretty sophisticated underwriting team and tools that we use and we have a lot of people that have banking and loan origination experience. So, we're underwriting these people, we're not throwing usurious high interest rate loans out, our goal is for them to be able to stick, you know, they get back on track and they don't have any more speed bumps, and they can pay their mortgage at a reduced rate. And so, we might take that loan that we, you know, if the payable is $100,000, we paid 25 for it, we might get them performing, and now we've created a loan that's to us, it's worth, we could turn around and sell that loan to another investor that wants to cash flow for 50 or $60,000. So-
James: Got it. 
Jim: So, we can double and triple our money by creating a performing asset out of the non-performing asset that we have.
James: So, your value add in this case is you're basically buying it at a deep discount, right let's say 100,000 loan, you're buying at 25,000, now you're going back to the house owner and telling you own hundred thousand, we want to get you back on track, we're going to forgive you for 30,000. Now you own 70,000, right and get them to start paying back the mortgage. And you probably will sell that 70,000 mortgage to another lender, right? Who might be, 50,000, so you basically level 25,000 to 50,000, I guess. 
Jim: Yeah, so we have various, we have like seven different exit strategies for these non-performing loans that we buy. And I would say 60 plus percent of the time, we end up with either a fast settlement from the borrowers at a discount, or we modify the terms of their loan and we create paper that's now worth, our average over, you know, eight years now doing this, and thousands of loans. we're averaging and this is including the good, the bad and the ugly, the ones that become worthless for various reasons, but we're averaging in about mid twos, like two and a half times what we pay for the loan.
So, if we buy a million dollars’ worth of loans, we're going to generate two and a half million dollars in revenue, it's a pretty nice multiplier. Now there's a lot of work, there's a lot of regulatory issues we have to deal with there, and there's a lot of debt forgiveness that happens in that process. But again, you hit it James, because we're buying this paper at such a deep discount, we have a lot of tools where we can make it work for both parties, both our investors and our borrowers. And that's what makes us feel good at the end of the day, we're serving, we're really serving two different groups of people. 
James: So, what's the reason the origin of the first lien, the original second lien lender did not give that discount to the homeowner?
Jim: Yeah, you know, in some cases, they actually do. It's pretty rare, but at the time when a lot of these loans were going into default, these institutions they just had trouble on their hands in every front, and again, they're their bookkeeping, if you will, their accounting these Junior liens is different than on a typical senior lien. So, they have to charge this paper off. So, they take the hit on their books, and it really becomes a very low priority for them to do anything with these loans at that point in time, but I think the biggest, the main answer for you there is they just had so much trouble on their hands, it was a low priority. 
James: Got it. Yeah, that makes perfect sense, I mean, this bank makes billions of dollars, sometimes, you know, second lien is just a small department in their whole balance sheet, right? They don't want to deal with it okay, we lose 75%.
Jim: It's actually treated differently from a compliance standpoint. 
James: Okay, got it.
Jim: It's not it's not the same as a 30-year mortgage. 
James: Okay, so maybe they have more flexibility in terms of compliance to get rid of it and just get rid of it.
Jim: Yeah.
James: And companies like you take advantage of that inefficiency of the bank. And you know, basically make a business out of it, which is really interesting. I mean, this is complicated stuff, I'm sure it's not simple.
Jim: No, it's not, there's a lot of trips and traps, and there's a lot of regulations and we're very compliance minded. We're licensed pretty much in every state now to do what we do. We've, you know, pursued licensing from the beginning because it's the right way to do it. And we're very consumer minded, and we try to keep up with all the credit laws and regulations because it's, you know, it's important to do so. 
James: So, let's say someone want to do like what you're doing right now. What kind of license and experience do they need to get started? 
Jim: Wow, well, gosh.
James: I'm not trying to create a competition for you, but--

Jim: No, I'm not worried, I'm not worried about that.
James: The banks as billions of dollars to dispose. 
Jim: Yeah, I would say that the best way for a person to get started, honestly, is to go to start attending conferences, there's some education that you can find online. Our company is not, we're not an education company, we're actually doing this business. I mean, if people want to reach out through our website, we can certainly point people to some resources. As far as licensing goes, everybody's got to decide their own, where they're going to stick the fork into that one, because it really depends, every state is different. It's there's, some similarities, obviously, but, there's two or three different levels of licensing and then you've got 50 states. So, we, you know, we spent a lot of money pursuing licenses in the states that we thought we would end up buying the most loans in. But in our business, the pickier you are as far as what states you buy loans, and the more you're going to pay the less product you're going to find. And you're not, it's not going to be a super scalable operation, we are a growing company right now and we're scaling up our operations. We just decided we'll buy in every state, and what does it get the licensing needed to be able to do business.
So, it's a pretty sophisticated operation, it's not to say a small investor can't get involved in it. But most people that invest in this space that we encounter are actually people that are interested in investing in our funds. And we you know, we have our funds are really for only for accredited investors. And, you know, that's a whole other topic, but it's a 100% passive investment for our investors that invest in our funds, invest in our business, our company operates the business models, and they just basically are passive investors, but for somebody to get in and become a note buyer or note seller. The best way to do that, honestly, is to start going to the industry conferences, listening to the presentations, talking to the people out in the sponsor hall and meeting people, that's how I started this business. Some of the people that work for us I met at some of the very first conferences I ever attended. And the people we buy notes from and the people we sell notes to, almost 100% have come through relationships built by getting out there and attending conferences and networking with people. 
James: Yeah, it seems to be very niche because, you know, there's no gurus teaching this right. I mean, otherwise, everybody's--
Jim: Super niche, there are a couple gurus teaching it. And again, I mean, offline, I can be glad to help some people and point them in directions, some people that I trust, and I know in the industry that actually do training, so it is available. Like anything, there's some fluff out there, but I find most people that are in the notes world are actually pretty down to earth good people. They're not trying to, you know, it's a small enough space that if people do something really stupid, the word gets around and you know, which it should, it should, the word should get around. 
James: Yeah, so I think, I don't know. I mean, correct me if I'm wrong. So, compared to like, buying Real Estate, versus buying notes, notes are a very transactional business, it involves a lot of coordination, right? So, because you think you're going to move like in a system by system, I have to do this first, I have to do this first, and there's a lot of complication in terms of compliance and all that. So, somebody who enjoys that kind of work. Now I'm going buying a deal and rehabbing it and seeing it looks pretty right now, or drive around that real estate and show everybody this is the property that I have. 
Jim: Yeah.
James: Your job is really, you know, this is not being seen anywhere, but it's all about transaction basis. And that's how you make the money. 
Jim: Yeah, and the upside of it is, you know, you can manage a lot of real estate value. These are the mortgages, you know, across the country, it's very scalable because you know, we don't get involved in the tenant’s toilets and trash, unless we have to foreclose which is very rare. And there's an infrastructure out there for our business, there's servicers, there's vendors, there's attorneys in every state that we use. There's document vendors that that check all of the collateral documents, the notes, the mortgages, all the assignments for us.
So you can scale and you know, the one thing though, that real estate has that the note industry doesn't, is if you buy real estate, you might have more work on your hands, you might to get your hands a little bit dirty, but you actually own an asset that's not going to go away in 30 years. So, the paper business is really clean, and we love getting monthly checks or ach deposits into our account from thousands of borrowers, it’s a wonderful thing, we don't have to go check on the properties etc. But at the end of the day, we have to keep buying these notes and creating new cash flows. Because if you own a, you know, 100-unit apartment building, that asset is going to be sitting there 30 years from now.
James: Like forever. 
Jim: Yeah. So, I really think just in general terms, a good strategy for an individual investor is to do both, have a hand in both. But we do invest in real estate, you know, personally, and we'll probably eventually start some funds for purchasing key types of real estate. But we started our company in 2012, based on doing mortgages, and it's been so lucrative for us, and we've built a great team and some great models and systems. And right now it's like 100% focus on scaling this business because it's just going so well for us. 

James: Yeah. And I think in the note business, I mean, you make the money in the crime section, but is there any tax benefit to it, I mean, that anybody can realize like for you also, for passive investors who invest in the funds like what you guys offer? 
Jim: Yeah, the tax aspects of it, I'll just be honest, it's not really my end of the business. From what people within my company say, yeah, we have some pretty advantageous tax treatment, but that's, again, there's a lot of gray area in this business and that's something that, I mean I can't say, it's something like the opportunity zones or it's you know, you have depreciation like you do with rental real estate, there's nothing that stands out to me that's worth going on the air and saying that oh, tremendous tax advantages because of x, y and z. That's out of my skill set and I wouldn't want to say something that would get somebody in trouble down the road. 
James: Okay, that makes sense. So, tell us about how passive investors can get involved into your notes, is it like you have a big fund where you go and buy you know, notes you know, in a bulk but they invest into this fund and they get certain percentage and how does that work? 
Jim: Right. So, I'll just give you in a nutshell because we have two different business models and we build funds around these models. But, where we started and where the largest frankly is in our workout funds, are our non-performing loan funds where we buy, we go out and buy, you know, pools and pools of these non performing mortgages. And then we turn we board them all with a national servicer, first of all, and then we bore them with our workout team, that gets busy doing our exit strategies with the borrowers. What we do is we raise, again, for accredited investors, we raise serial closed end funds.
So, we'll go out and we'll raise say $10 million, and over the course of maybe one to six months, and then as soon as we start as that capital starts coming in, we're spending it, we're always buying loans. We're always working out loans, and we're always exiting loans, but we'll put together like say fund number one, and we're actually working on funds number four and five right now. So, the investment capital comes in, we're bidding and buying loans, and we're working out those loans and then as those loans are exited, we're directing the revenues back to our investors, and until they get their capital back and then we have a profit split that we do with them.
So, that's our more speculative growth oriented strategy. It's not a liquid strategy. So, person invests half a million dollars, we tell them, you know, don't count on seeing any of your money, at least for the first 18 months, because it takes a while to get these things worked out and get, we'll see some early exits, you know, six months, 12 months, but by the time we hit three years, most everything has been wound down, we've executed our exit strategies, the investors have gotten their money back, plus their profit. And, you know, we target and we've performed this, you know, anywhere from the high teens to the low 20s, mid 20s. In terms of a real IRR, that's a time loaded rate of return. So, it's a very lucrative end of the business for people that understand it. And for people that don't need, you know, the cash flow or they don't mind a three-year lockup on their money, or other side of our businesses, the Income Fund, and this is where we're buying loans that are already performing.
So, we're buying cash flows, we have a sophisticated underwriting model. So, an investor puts their money into our fund, and we basically start paying, and we pay a preferred return of eight and a half percent. And, you know, this is just mailbox money. This is for somebody that wants to, you know, wants cash flow on a regular basis. And, you know, so our investors actually own, our funds actually own the loans. We do not own them, we only get paid if we're successful, and we get paid for managing the fund. So, there's no you know, there's no fluff in the middle, and it's been great. We're building both sides of the business and having really good success right now. 
James: Got it. How does your business model changes if there's a recession? 
Jim: Yeah, I love this question. I feel like we're so well positioned for this, because I'll just compare it to say, I'm going to just focus right now on the income side of our business, because that would be where you would think that recession would be the most immediately effective. On the non performing side, we're already buying these loans at such deep discount. So, we have all kinds of, we can be patient with those, there's all kinds of ways we can exit those successfully. But on the income side, first of all, we price into our model, a pretty substantial default rate, like 10% of our loans, we price them as if 10% of them are going to go into default. We have never seen anywhere near that in our track record, but you know, we have that built into our pricing. One thing that will tell you--
 James: What about in 2008? 
Jim: What was that?
James: What about in 2008?
Jim: So Well, we only started the business in 2012. So--
James: Okay, got it. Yeah. 
Jim: So what if another big event like that happens? So, our Income Fund, our loans are spread across the country geographically. Our typical loan is a you know, $120,000, $150,000, home in the Midwest, these are workforce houses, these are bread and butter houses, the only way these loans are going to go into default, is if there's a sustained loss of income by these borrowers, these aren't speculated bubble markets. We do have some loans on the west coast and on the East Coast, we're covered with a pretty substantial amount of equity because of when we bought most of those loans. Frankly, we are balancing our portfolio, we're looking at our portfolio all the time and divesting ourselves and what we perceive as a higher risk markets, but you got to keep, this is a really important point I'm about to make here. You got to keep this in mind, If I'm lending money to a fix and flipper. And they, you know, they see that they're, it's taking them longer to finish the work. The expenses of the of the rehab are increasing, and the resale values are coming down.
At some point in time they look at that project and go, I can't make any money on this deal anymore. If you're lucky as the lender, they hand you back to keys and you got to have finished rehab project in a remote location, that, you got to go take care of okay. You're not a passive investor in that scenario. In our situation, again, your investment is spread across hundreds and hundreds of bread and butter homes where people with real jobs and real kids that go to the real school down the street, they live in these homes. They're not looking at the metrics, they're not looking at Zillow every morning and saying, hey, look at this honey, we don't have near as much equity in our property, we should hand the keys back to our lender.
This is a this is home sweet home. So, even if they end up in a negative equity situation, there's what we like to call in our business, emotional equity. You know, people don't want to get foreclosed on, they don't want to file bankruptcy, you know, they want to keep paying their mortgage, it's their home and they're on their way to owning it free and clear at some point on a typical 30-year mortgage. So, they're not looking at life the same way as a rehabber or a business to business lending relationship would look at life. So to me, this is our biggest, I don't think anything on the planet is recession proof. But I think we're recession resistant, I think we might see in a serious setback, if there's a big unemployment reversal, that would be probably the biggest thing that would hurt us, but even there, because most of our properties, if we had to foreclose, and take the property back, we could actually rent those properties out for more than what the mortgage payments are now. So, we're pretty capital protective. And I think our cash flow is pretty well protected as well. So, I love our models for that reason, exactly. 
James: Yeah. So that's, very interesting. I mean, I'm looking at it right now. Yeah, it makes sense. Right. But if something like 2008 happen, which I don't think so, but there will be a lot more mortgage default, right? I mean, yeah, you It could be a problem for your current portfolio. But the systems and process that you already have might be a really good opportunity for you to you know, to buy--
Jim: Yeah, actually, I hate to say it because it sounds like the undertaker saying, hey business was great, this year, a bunch of people died, you know? 
James: Yeah, I know.

Jim: It's not something that you want to, I'm not looking forward to people having trouble or the economy having trouble. But the fact of the matter is, if we go into another 2008 type event or anything even close to it, it's going to be back up the truck for us, because like you said, we have the systems, the processes, the teams in place, and the expertise and so it would be business wise, it would be a very big time for us. But as far as our existing mortgage portfolios, I just don't think we're going to get hurt if there's a, even if there's a pretty significant turnaround, because again, it's tied to the jobs more than anything, our business is tied to jobs, not so much what's the appreciation rate or depreciation rate of real estate, that's what we love about our models, they are very uncorrelated to both the real estate market and we're super uncorrelated to Wall Street.
I mean, we saw what happened just a couple days ago with stocks and bonds. And I might say, well what happened to your portfolio? What would happen to your investment and Aspen? Well, absolutely nothing, people's pay their mortgages on the day that they were due, and we got more that will be paid this week and more the next week, and life goes on. And it's just we're really not in that world. And that's what we love, and that's why we see more and more, even institutional investors moving into alternative investments. And you know, like your own James and like ours, you know, there's just, there's a real pent up demand for uncorrelated places for people to put their money. So, this is a really good time for people like us. 
James: Yeah, absolutely. Hey, Jim, why don't you tell our audience and listeners on how, you know, how to get hold of you and your company? 
Jim: Yeah, sure. So, the best way would be, I think you're going to have in your show notes, a link, a private link for your listeners to our website, but I'll go ahead and just give you, it's just go to our website and then request information, but it's, So, Aspen funds is one word, "" And just search around there, and there'll be a place where you can request some information or somebody to reach out to you. And if you're wanting to get involved in buying and selling notes, we can direct you to some great resources. And if you're interested in our funds, again, you have to be an accredited investor, and we can walk you through that process as well. 
James: Got it. Well, thanks for coming into the show, I really learned a lot. I mean, I do not know much about this note business, but I think I really learned a lot in it. It's very interesting. 
Jim: All right, very good. Happy to be here.
James: Thank you.