Explaining First Position Commercial Mortgage Notes (FPCMs)

First Financial Tax Group pic

First Financial Tax Group
Image: fftaxgroup.us

 

 

Barry M. Kornfeld is a financial advisor and principal of First Financial Tax Group, which is based in Boca Raton, Florida. Barry Kornfeld offers an objective approach to clients, helping them develop alternative income plans to meet their financial goals. He focuses on first position commercial mortgage notes (FPCMs), which are typically a less risky endeavors than traditional bonds and stocks.

FPCMs are short-term loans, which means they offer increased flexibility for clients. They also pay a dependable monthly income that does not fluctuate based on the state of the market. This makes them one of the more dependable options for those facing or in retirement.

These higher return vehicles are secured by commercial real estate. All that lenders need to do is work with Kornfeld and his team to use a commercial mortgage to serve as the collateral for their 1-year loan. The client is secured by having the first lien position for the mortgage on that high grade commercial real estate asset. In addition, the client will be recorded on the title on this commercial real estate.

The first lien position is important because it means that the lender has priority over all other liens on the property, thereby giving the client a great deal of security. Lenders are able to use both qualified and non-qualified funds for the loans, including trusts, IRAs and 401(k)s, or can lend under their own names.

What is a Lien?

 

Lien

Lien

Barry Kornfeld is a proficient and sincere financial advisor. Also a supporter of Shriners Children’s Hospital, Barry M. Kornfeld co-owns the Boca Raton-based First Financial Tax Group with his wife of 29 years. Mr. Kornfeld focuses on assisting pre- and post-retirees with retirement & income planning, and he specializes in First Position Commercial Mortgage notes (FPCMs). FPCMs pay a 6% yield over one year and are considered a safer alternative to other financial products.

FPMCs provide clients with a first mortgage position, also known as a first lien position. This assures the owner of the FPCM the first lien position, which is the most secure and highest priority. This position differs from secondary or tertiary positions which are only repaid after the first lien position.

A publicly recorded legal interest, known as a lien, is an encumbrance on an asset or property that remains in effect until the debt is repaid. First liens must be properly developed and recorded to be secure and binding. Mr. Kornfeld and his resource partners work to ensure that all FPCM holders have properly recorded liens in the county land records where the subject property is located, so that all FPCM note holders enjoy a low maintenance and smooth experience for the duration of their holding period.