Kondaur Capital Corp., an active investor in distressed and underperforming mortgages, is marketing a $79 million mortgage-backed security that is collateralized by $263 million of nonperforming loans.
The bond is being underwritten by Royal Bank of Scotland Group PLC in what appears to be a private placement. (A copy of the offering prospectus was provided to National Mortgage News.) A search of the Securities and Exchange Commission's database found no filing under the Kondaur name.
Company principal Jon Daurio declined to comment on the offering. He co-founded the firm with John Kontoulis. (The name Kondaur is derived from their last names.)
If successful, the offering will allow Kondaur to cash out of some of its investments in nonperforming loans.
But the prospectus offers no insight on what the Tustin, Calif., company paid for the collateral in the secondary market.
The offering circular notes that after Kondaur re-evaluated the loans, it determined that the weighted average loan-to-value ratio is 210%. The original loan-to-value on the loans is 83%, the company said.
The bond that Kondaur Capital hopes to sell does not mature until 2036.
