The following questions and answers are provided in this FAQ and Rules section are for general information only and may not be completely accurate in every circumstance, do not purport to be legal advice, and are not intended to be legally binding on Capella Mortgage.
Questions involving interpretation of the laws of the State of Nevada and your legal rights and obligations should be addressed to an attorney.
Continued use of this website constitutes your agreement with this policy and all other policies posted here.
The entire process to investing with Capella Mortgage
Whether you are positive you want to be a trust deed investor, or whether you just want to investigate, here is the process:
1. “REGISTER” AS A USER OF THE SITE – this will give you access to all of the trust deed screens. Once you register, I will receive an email with your registration information, and I will give you a call (or you can call me at 702-214-4700) and indicate that you just registered on the site, and my staff will put you through to me. Why do we need to speak on the phone? Read #2 below.
2. “ACCREDITED” OR “NOT ACCREDITED”? – When you and I speak on the phone, I will ask you some questions so that I can determine that you meet the minimum requirements listed by statute in the State of Nevada. Trust Deeds in Nevada are exempt from licensing as a “security”, but your state may have requirements that are different from our state, and you must comply with those as appropriate. My state requires that you meet a minimum of either 1) a net worth of $250,000 – not including the equity in the house you live in, or 2) an income of at least $70,000 or more for each of the past two years. The State of Nevada does NOT require that you prove this, but you do have to sign a piece of paper on every trust deed you buy, that states that you do meet at least one of these conditions.
Why does my state care about this? Don’t you have the right to invest where and when you choose? Yes, BUT……..we do not want you to place every last cent into trust deeds – that is not a good diversification strategy. It’s smart to have safe limits to investing. That is where Phase II comes into play. Our state law says that you cannot invest more than 50% of your net worth into trust deeds, and you cannot place more than 25% of your net worth into any one trust deed. That is why I am going to ask you many times “what is your net worth?” You don’t have to tell me the whole amount, but it has to be at least high enough that you can satisfy your budget for trust deeds. Make sense? If not, we will talk more about it on the phone. Fill out your paperwork and return to us, including your W9 and your direct deposit form. Investors are always nervous about this step – but think about this – how is Weststar going to deposit money into your account if we don’t send them your bank information? How are they going to report the information for your taxes?
3. CHECK OUT THE TRUST DEEDS after I have added your vesting into the database and given you a pin number. As soon as you sign back in (after I approve your registration), you can see the trust deeds. Do you like one? Want to reserve it so you can be the investor that funds it? Then you will have to do three things:
2) Do the paperwork. You will find links to the paperwork listed below in the side panel of the screen. Fill it out and then email it to us at firstname.lastname@example.org
4) Investigate the trust deeds by clicking on the orange link that says “DOCUMENTS”. Every single loan that we do meets the new Dodd-Frank rules and has a debt to income ratio of less than 43%.
Please remember – it is as much about the borrower as it is about the house.
5) CLICK ON “RESERVE THIS LOAN” for the one that you want to reserve. Anyone can reserve a trust deed and once the loan comes out of processing, and before it goes into underwriting, we will call the investors that reserved the deal, and will discuss the deal with them. If it is decided that you will fund the deal, then I will “confirm” your name on that trust deed as a “Beneficiary”, and you will be able to watch the progress of the transaction by clicking on “View My Reserved Loans” which is on the “View Trust Deeds” page.
6) Once the loan is done in underwriting, I will merge the loan documents, and we will then send them to you through “docusign.com”. Make sure that docusign.com is on your safe sender’s list, so you see the email when it comes through. Make sure that your name is spelled correctly, and the loan amount is correct, and then you will sign many, many pages of disclosures. At the end of the document you will be able to save a copy of the documents.
7) Next (and in the docusign also) you will receive wiring instructions. Please coordinate with your financial institution so that you understand their requirements for wire transfers. Most of our investors have accounts with banks that allow for wire transfers to be processed online from the comfort of their home. When we give the “go-ahead”, WIRE ASAP. Your funds go to the title company, and this is a time sensitive operation. We do not want to be the cause of the borrower having to pay a penalty for not closing on time.
8) Within two weeks of closing you will receive a deposit into your account for the prepaid interest, and you will receive an email with the “Investor Closing Package”. Please keep this paperwork in a folder with the other items that you have downloaded.
9) You will then receive a payment into your account sometime between the first and the fifth of the 2nd month after the closing. For example: if escrow closes September 15, the borrower’s first payment is the 1st of November, because interest is paid in arrears. Item #7 above is the interest payment for September 15-September 30th, and the November payment is for the interest from October 1 through October 30th. This formula will work no matter when the escrow closes, and this is the most frequently asked question from new investors.
10) Each month you will receive payments, and sometimes, or every time, or not at all, you will receive principal reduction payments. The monthly payment amount does NOT change, but part of the payment may be applied to principal, if the borrower has made at least one principal reduction.
11) Eventually, it will be time for the borrower to pay off the principal balance. Usually, the borrowers pay off early, but sometimes they will request an extension. If they want to extend, we will check their credit, the recorder’s office to make sure no other liens exist, and their payment record, before we contact you. At that time, if you like their payment record, and you still like the property, you may extend the loan, and the payments will continue as usual. If you want to be paid off, and the borrower wants to extend, I will try to put them with another investor, without charging them for a whole new loan.
POINTS OF LAW
With the 2009 Mortgage Investment Disclosure Act, it became illegal for investors to lend on residential real estate, without using the services of a broker. This is because of the legailities of lending on residential real estate. However, the State of Nevada has a law that says that it is illegal to “hold yourself out as being able to make a loan on ANY real estate (residential, commercial or land), so it is necessary to use a broker no matter what. Make sure you work with someone who is licensed with both the State and Federal regulatory bodies. You could receive a cease and desist from the Mortgage Lending Division if you don’t.
How do I reserve a trust deed?
The ‘ONLY” way to reserve a trust deed is to click on ‘RESERVE THIS LOAN“. If you call us to reserve, we have to do the same thing as you, so, it is better to not leave it to our memories, and just click on “RESERVE THIS LOAN” when you are on the screen looking at it. The trust deed will still show up on the website so the other investors can look at it and reserve it.
Also, remember, simply “RESERVING A LOAN” does NOT make it available in your Online File Folder. You must speak to a member of Capella Mortgage in order to ‘CONFIRM” the reservation. Once we confirm the reservation and make it official, it will show up in your “View My Reserved T.D.’s”. Many investors are confused about this step, so please follow these instructions for the best results.
How do I know I got the trust deed I wanted?
Once you have “reserved” a trust deed, your reservation is reviewed by Capella staff, along with all of the other reservations. If you are chosen as the investor for the deal, we place your name into the borrower record, and at that point, you will see the trust deed show up in your “Reserved Trust Deeds” screen (which is found on the View Trust Deeds Screen as shown below. More than likely, we will be on the phone with you when the record is confirmed with your reservation.
Sometimes, in order to get into the My Reserved screen, you might have to put in your email address, and your phone number in the following format “702-123-4567” (without the quotes!). You can watch the progress of your Trust Deed by viewing the borrower’s online file folder (click on the orange “Documents” link at the bottom of the information.
PLEASE NOTE: IF YOU ARE NOT CHOSEN AS THE INVESTOR, YOU WILL NOT RECEIVE A CALL FROM CAPELLA, AND AS OF JUNE 2014, THERE IS NO AUTOMATED METHOD OF CONTACTING ALL OF THE INVESTORS THAT MADE RESERVATIONS.
What is the process a trust deed goes through?
These are the major steps we go through with a loan.
Interview Done, Approval Letter Sent, File gets Setup, Credit is checked by Corinne, E-File Made, Prelim Ordered, File Processed (get insurance, review documents, analyze income, change things that are wrong), Record is Perfected, Corinne gives Final Approval, Investor is Confirmed, Docs Prepared, Docs sent to Investor, Escrow, and Borrower, We Receive the Escrow Docs, Investor Receives Docusign from Capella with Wiring Instructions, Borrower Signs the Docs, Borrower wires in his Funds, We request Investor to Fund, Investor Funds Received, Investor Funds Verified, Trust Deed gets Recorded, We receive Package From Escrow with Checks, Checks & Package gets Audited, Packages sent out to Borrower, Investor, and Weststar, Original Note and Investor’s Prepaid Interest is mailed to Weststar, File is Closed Out.
Phone number, email, contact information for Capella Mortgage
Capella Commercial Mortgage
NMLS # 372157, Nevada State License # 456, NMLS #372157,
NMLS Agent License #376581,
3765 E. SUNSET, #B9, LAS VEGAS, NV 89120
(888) 782-3101 FAX
Matthew Dale, extension 301, 702-521-0321
Are there requirements or qualifications to trust deed investing in Nevada?
Yes, the state of Nevada requires that you earn $70k or more a year for the past two years, or that your net worth is greater than $250,000 (excluding the equity in your primary residence) in order to invest in trust deeds. HOWEVER, THERE IS AN EXCEPTION IF YOU ARE USING YOUR IRA OR KEOGH OR 401K.
I registered, now what?
If we have received your request for registration then, I would need to speak with you at your convenience so I may approve your registration. My name is Corinne Cordon and I am the owner and broker of Capella Mortgage.
The reason for this process is the requirements to lend in Nevada. The state of Nevada requires that you earn $70k or more a year for the past two years, or that your net worth is greater than $250,000 (excluding the equity in your primary residence) in order to invest in trust deeds. HOWEVER, THERE IS AN EXCEPTION IF YOU ARE USING YOUR IRA OR KEOGH OR 401K.
I am usually available until about 9 p.m. for investors and can answer any questions you might have. My cell phone number is 702-271-9185 and at work it is 702-214-4700. My email address is email@example.com. You can also call the investor relations manager at 702-521-0321.
As soon as I approve your registration, you can view the trust deeds. We will then add your “Investor Vesting Record”, complete all necessary paperwork, help you to reserve your first trust deed(s) and then advise you as your trust deed(s) progresses through processing and underwriting, and funding. The website is fun and easy to use, but if you have any suggestions as to how to make it easier, please let me know.
We look forward to working closely with you to find the right trust deeds for you and to help you meet your financial goals!
What do I do after I sign up?
Here is a recap of the process, now that you have signed up to be an actual trust deed investor. Becoming an actual investor, gives you the ability to invest right away. Just a side note, trust me when I say that these trust deeds go fast. The best way to grab the one you want, is to “Reserve A Loan” on the top of each trust deed, under the address. The other way to get a trust deed, is to “Add Funds To Your Account.” We watch this every day, and if there is a trust deed we know you would like, it doesn’t even get onto the website – it goes straight to you for your review.
Your next step is to do the “PAPERWORK” required by the State of Nevada BEFORE you can fund a loan. You will find the documents listed in the side panel of the website. Please fill these out and then email them to us at “firstname.lastname@example.org”.
How much interest do I get?
EFFECTIVE ALWAYS SINCE 2009 STATE LEGISLATURE – It is the law that all private lenders take a subservicing fee to assist any regulator or receiver that has to come in and take over a private lending company due to mismanagement or insolvency. Capella Mortgage follows this state law. If we make a type and put the interest rate to the investor the same as the interest rate to the borrower, then it is a mistake. I will no longer allow deals that break this law to be closed until the typo or mistake has been fixed. Continued use of this website constitutes your agreement with this policy and all other policies posted in the “Rules” page of this website.