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How does a Mortgage Fund work? |
A: |
An investor purchases shares of the Mortgage Fund which contains a large number of diverse trust deed loans as security, similar to a “mutual fund” of loans. The Mortgage Fund then lends the money out to borrowers. Borrowers make interest payments to the Fund, and the Fund pays earnings to investors. |
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What is the benefit of investing in a mortgage pool vs. direct trust deed lending? |
A: |
Diversification and Management are the two key benefits. Risk is spread out over a multitude of trust deed loans rather than owning just one or two loans. The mortgage pool manages collections, disbursements, foreclosures when necessary and takes care of all accounting including federal and state compliance. |
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Q: |
What is the minimum investment? |
A: |
The minimum investment amount is $100,000. |
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Q: |
Do I have to pay a load or commission when I invest? |
A: |
When purchasing shares directly from the fund, no portion of the gross proceeds of the offering will be used for the purpose of paying selling commissions or fees incurred in the sale of shares, 100% of your investment goes into the Fund. If you go through a NASD brokerage, up to 5% of your funds could be used to pay fees. |
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How often does the Fund pay a dividend/distribute earnings? |
A: |
The Fund pays a monthly distribution. The distribution is an estimate of the company’s annual profits. Investors have a choice of receiving monthly cash distributions, reinvesting distributions by purchasing additional shares, or a combination of both. |
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Q: |
Can I invest my IRA in the Fund? |
A: |
Yes, self-directed IRA's can invest in the Fund. Please call (866) 575-5070 for more details. |
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Q: |
What kind of return should I realistically expect in a mortgage pool? |
A: |
We anticipate our members will receive a return ranging from 8% to 11% on an annual basis. In order to stay competitive and maintain a portfolio featuring high-quality loans, Wilshire carefully monitors the market and adjusts interest rates as needed.
If our managers cannot obtain at least an 8% annualized return for members in any given month, the fund will "claw-back" up to one half of that month's management fee to help obtain this minimum goal.
For Example, if in a particular month the fund returned .625% (7.5% annualized) to members, then up to one-half of the .104% monthly management fee (1.25% annualized), will be contributed back to the fund to help reach the 8% minimum return to members.
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Q: |
What information is provided for tax reporting? |
A: |
Income information is reported on a Schedule K-1. |
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Q: |
Is the Wilshire Income fund regulated? |
A: |
Wilshire Income Fund is a registered security and is under the jurisdiction of the State of California Department of Corporations. This permit is permissive only and does not constitute a recommendation or endorsement of the securities permitted to be issued. |
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Q: |
Can a shareholder withdraw their investment? |
A: |
The operating agreement of the Fund allows you to withdraw all or a portion of the investment after an initial twelve-month period has passed. After that period, you may withdraw amounts in $25,000 increments, though some restrictions apply in consideration of the availability of capital. Earnings will accrue to the date of the withdrawal, and there are no penalties for withdrawals. |
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Is the fund investment open to everyone? |
A: |
No, there are investor suitability standards.
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Q: |
How do I know how much money I’ve made with the Fund? |
A: |
As an investor you will receive a monthly statement of your account. |
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Q: |
Can I invest in individual trust deeds through your company? |
A: |
You may purchase individual trust deeds through Wilshire Finance. California Department of Real Estate, Broker Number 01841579. |
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