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Providing a Safer Fixed-Income Alternative with FPCMs

Barry Kornfeld

The co-founder of Florida-based First Financial Tax Group (FFTG), Barry M. Kornfeld has more than three decades of experience as a financial advisor. Barry Kornfeld’s group offers pre- and post-retirees with conservative tax and income planning services, and specializes in first position commercial mortgages (FPCMs) and other alternative growth strategies.

These FPCMs are one-year bridge loans providing 6 percent APY. The interest is paid monthly, giving the lender a consistent monthly income. The FPCMs are considered a secured asset class. Because they are only for 1-year, they allow clients to remain flexible rather than be locked into one asset for a long period of time.

These loans are secured by commercial real estate, which historically are more stable than residential real estate. The loans also have first-lien position, giving the lender a greater degree of safety. Aside from being safer, the transaction is simple and straightforward. For one year, the client receives monthly interest payments, and upon maturity, the principal is returned.

 

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