Carrie Bay | 12.10.08

Liberty Capital Asset Management said yesterday that it has executed an agreement with an affiliate of New York-based asset manager Silar Advisors to invest up to $50 million to acquire defaulted subprime mortgage pools at a discount.

Liberty is an asset management company based in Las Vegas, Nevada that acquires pools of non-performing mortgage loans and then re-performs those loans by restructuring the financial parameters so that the defaulted borrower can return to making payments on time. Liberty, which holds over 4,500 properties in 23 states, said it does this by carefully analyzing the individual borrower's payment history, defining just how much the borrower can afford to pay each month, and then restructuring the financial variables (interest rate, principal amount, etc.) so the borrower can afford the new payment and avoid foreclosure.

The announced agreement is viewed by both parties as a strategic venture in which Silar is providing the capital and valuation expertise and Liberty is providing the operational expertise that will allow Liberty to turn the subprime loan pools into profitable assets.

Liberty Chairman and CEO Michael A. Barron said, "The addition of Silar as a strategic partner to Liberty is a significant step forward for us in this space. We have spent months working out the details of this venture and we are pleased with the integration of our respective organizations."

Speaking about the agreement, Silar Advisors CEO Rob Leeds said, "We are happy to be a business partner with Liberty in this unique investment opportunity. We are uniquely suited to match up with Liberty's expertise in the subprime loan repair market."