INVESTING IN FRACTIONAL PORTIONS OF A LOAN

Most of our investors prefer to acquire smaller portions of many different deeds of trust, usually first trust deeds. When acquiring a fractional portion of a loan, our investors are assigned a prorata interest in the fire insurance and the title insurance. That fractional portion of the loan is assigned to you by an assignment of deed of trust and of the note. The recorded assignment of deed of trust is your proof to the world that you own that portion of the trust deed. A copy of the recorded document, with the county recorder's instrument number on it, is mailed to you. A copy of our computer records is always off the premises. The object is to be sure that if a jetliner should crash and burn on our office or some other terrible occurrence, your investment would survive without us.

Occasionally we are asked by investors, but what happens if the investors sharing portions of a loan do not agree?? Our answer to this is to look at our documentation regarding fractional loans. R.C. Temme Corporation makes the loan service decisions. In the event an investor does not agree with our decisions and that investor's desires are legal, we take a vote of the investors. The majority rules, before and after a foreclosure. All parties have indemnified the others against loss if they, as a voting minority, do not go along with the majority.

 January, 1997

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