Good day, and welcome to the AAMC Investor Call. Today's call is being recorded. At this time, I would like to turn the conference over to Mr. Kevin Sullivan. Please go ahead. Good morning, everyone, and welcome to our third quarter investor call. I'm Kevin Sullivan, General Counsel of Altisource Asset Management Corporation. Today, we will update you on developments in our business during the third quarter and discuss the material referenced in our investor presentation, which was issued earlier this morning. It can be found on the stockholders page of our website at www.altisourceamc.com. Note, information on forward-looking statements appears on the investor presentation, and we direct your attention to that information. This audiocast is copyrighted material of AAMC and may not be duplicated, reproduced, or rebroadcast without our consent. I'm joined today by our Chief Executive Officer, Jason Kopcak, and our Chief Financial Officer, Stephen Krallman. Jason will update you on the company's business, and then we'll be happy to answer any questions. Jason, over to you. Thank you, Kevin. I would also like to welcome everyone to our call. I'm excited to speak to you this morning and to update you on our progress. We continued developing our private credit business in the third quarter. We have produced over $123 million in private credit commitments through the end of the third quarter, an increase of 175% from the second quarter. More than 90% of those commitments have terms of one year or less. Despite the Federal Reserve raising rates by 225 basis points over the last five months, our current portfolio is still profitable. We have dynamically raised our rates and are currently originating loans with a total yield of 12.5% or greater and have lowered our advance rates on our bridge originations by 10 points. We generate total revenue of over $1.9 million in the third quarter, more than triple the net revenue earned in the second quarter. Turning to other developments during the quarter, we entered into a warehouse line with Flagstar Bank during the third quarter and have received approximately $53 million of funding from Flagstar by the end of the quarter. We also have opened a new sales headquarters in Tampa and repurchased approximately 287,000 shares of our common stock from Putnam at a discount to the trading price. Finally, in an arbitration filed against the company by its Former Chief Executive Officer, Indranil Chatterjee, the arbitrator recently dismissed all of his claims, sanctioned him for his misconduct, required him to pay back his signing bonus in accordance with his employment agreement, and permitted all of our remaining claims to proceed. We are pleased the arbitrator found Mr. Chatterjee's claims meritless. Now, I would like to turn your attention to an overview of current market conditions. Despite the material rise in interest rate environment over the past year, we are still seeing strong demand for housing that we believe is due to both the housing shortage as well as the modernization of existing housing stock in the United States. We continue to see strong demand in the investment property space from borrowers and investors, and we are increasing our focus in this space accordingly. In the bridge and rehab market for single family and multifamily homes and ground-up construction, we have dynamically adjusted our loan pricing to higher levels and implemented lower maximums of loan to cost and loan to value ratios to accommodate the headwinds that the market is experiencing. We are aligning our business model to provide credit to build affordable housing and services to assist homeowners. As a reminder, we are currently originating and acquiring business purpose loans and are not yet actively providing mortgages in the consumer residential market. While the interest rate increases and the home prices decline in many markets are affecting the entire real estate market, we continue to see opportunities in the residential transitional loan space. In addition, the market conditions in the largest MSAs across the U.S. vary widely. For example, while a number of West Coast markets have experienced significant declines, other markets in the Midwest, Northeast, and Southeast have had different trajectories. Now, let me spend some time discussing where we are headed. We are creating alternative credit through two main areas, direct to borrower, real estate developers and investors, and wholesale originations. We are primarily focused on originating private credit products, but we can also augment production through the purchases of closed loans. Originations allow us to better control the creation of the assets as well as being more creative in terms of yields to the shareholders than purchasing loans. As I've said previously, we do not plan on being an aggregator. However, current volatility in the fixed income markets has delayed our forward flow initiatives for selling assets. We are making significant strides in bringing new capital to the bridge space take-out investors for alternative assets that we are creating. In addition we believe utilizing technology, data, and analytics will be critical to our success. We have developed and are continuing to optimize a data-driven proprietary system which will dramatically allow us to increase our reach to the specialized demand in the market. We are also creating an enterprise database management system to help us utilize information for purposes of understanding our markets, clients' needs, and the overall customer experience. In short, we believe there still are opportunities in the residential transition market, and we think our data-driven analytics provide us an advantage over our competitors. That concludes the prepared material for today. I'm now happy to take questions. Thank you. If you would like to ask a question at this time, please press the star key followed by the digit one on your telephone. Please ensure that the mute function on your telephone is switched off to allow your signal to reach our equipment. If you find that your question has already been answered, you may remove yourself from the queue by pressing star two. Again, please press star one to ask a question. We'll pause for just a moment to allow everyone an opportunity to signal for questions. We will take our first question from Jeff Moore from Burr Oak Capital. Please go ahead. Hey, Jason. I was curious as to what the loan book looks like. What's the general update on the sales process for it? What kind of institutions are you talking to for selling those loans? Do you have any ideas what the timeframe for closing should be? Hey, Jeff, it's good to connect again. Appreciate the question. Those are great questions. Let's talk initially about what institutions are buying DSCR loans, then we'll go into bridge loans. At a high level, generally speaking, insurance companies, REITs, money managers, and some banks buy DSCR/investment property loans. We are fairly far along with several of the largest REITs and money managers, insurance companies to sell on a forward flow basis. We expect to have these takeouts firmed up in the next two to three weeks. We're in ongoing conversations with them to get this wrapped up. As I mentioned, the goal is not to aggregate these loans. The goal is to originate and sell on a weekly basis into these institutions. By selling on a forward flow basis, the goal here is to minimize interest rate risk, principal risk, and create a velocity of business that capitalizes on the yield premium that you obtain when you sell loans. Once we get these takeouts firmed up, the goal at that point will be to increase our marketing/lead generation, which will increase effectively revenue that we're not currently getting through the sales of loans, which effectively will be incremental to our current revenue. That's for the DSCR/investment property. On the RTL side, the residential transitional loans/bridge space, we're in a similar situation where we're pretty far along with several counterparties to set up forward flow takeouts. To step back a second, traditionally speaking, in the bridge space or RTL space, you have REITs, credit funds, money managers, hedge funds, and a few insurance companies that buy this product. Again, we're pretty far along. We expect in the next two to three weeks to have these forward flows set up, and then the goal would be to sell on a weekly basis. As I mentioned with DSCR loans, the same things with RTL. We're not looking to aggregate. The goal is to originate the sell model. Again, that keeps the interest rate exposure down, keeps our principal risk exposure down. That's where that's at. At the same time, once we get these forward flow relationships in place, we'll start turning up our marketing, our lead generation to drive the creation of products into these clients. Again, I think just to summarize, as you can imagine, as we sell on a programmatic basis, we'll start gaining revenue that we're not getting now through the sales of loans because we'll receive premiums from selling loans that we're not currently getting. To touch on, I think something you and I have talked about in the past, generally speaking, from an earnings or spread standpoint, we're targeting right now in the current environment about 350 basis points per origination. The goal would be as we originate loans, to sell them to effectively earn about 350 basis points per origination per product. That's both for the DSCR/investment property loans as well as the bridge product. That's in the current environment. Okay. Hopefully I answered your question, Jeff. Yeah. Previously, you said that you thought you could be doing about $600 million of these originations and then sales to whatever institutions want to buy them, right? Do you still think that's a good number? Or given the market right now, do you think that's gonna be reduced since you know things seem to be a little bit slow? Yeah, no look and that's a good question. For 2023, we feel very confident we'll be at $600 million, if not greater in total production. For us to get those numbers, we have to have these takeouts lined up where again as I mentioned a minute ago, we're pretty far along in getting these takeouts lined up. Once we get these takeouts lined up, the marketing that we talked about, the lead generation system that we created, we tested between September and October, we feel very good that even in the current environment, that we'll have in excess of $600 million in loan production. Yeah, we feel good about it. Even though there's volatility in the fixed income market, there's still demand. There's still demand for both the rental/DSCR product and for the bridge. It's just not as liquid as it once was 12 months ago. There's still plenty of demand there. Okay doing some back of the envelope math, if you're getting 350 basis points per origination on $600 million, you would be getting a spread on that $600 million in next calendar year of about $21 million, right? That's on a market cap of, call it $29 million right now. I mean, once you have this thing at scale, like what kind of margins are you expecting, and how much of that would be profit. 'Cause I mean, that's not even taking into account the you know $100 million of loans you have on your books that at some point next year should be yielding you know double-digit interest as well. At the end of the day, those are. Again, it's a good question. Look, we have our model figured out where we think we're gonna be for return on equity. We're still building out, so frankly we're still building out. We have the synergies in India, which makes us very competitive in terms of processing and creating these loans. We feel that we've already proved out internally our marketing and lead generation is very cost effective. I don't wanna get into specifics because we're still building it out. I can say that we're not an aggregator. We're not trying to compete with the REITs. We have a originate to distribute model that we feel our return on equity is well north of what you see in the aggregation side of the business. With that being said I don't wanna state a return on equity just yet, but we feel pretty good that our model and where we think we're headed is gonna prove out, and we'll know next year. It's gonna be north of what you see at REITs and aggregators. I know that's a. Okay. I'm trying to give you a framework as opposed to. Yeah. It seems like you guys are sort of, I guess strengthening your borrower requirements right now by lowering the. You said in the presentation you're lowering your LTV and your loan to cost. What general metrics are you using for borrowers? Like I mean your average borrower is it like a I don't know like a 700 credit score, a 600 credit score, an 800 credit score? And then like how does that process work? Again, that's a great question, Jeff. A couple We have two different products. You have the rental investment property product. Again, neither of these are consumer products. These are business purpose loans. On the DSCR rental product, our criteria comes right from insurance companies, REITs, banks, and money managers who are very active in aggregating. Generally speaking, we take their criteria, and that's what we develop our marketing. Generally speaking, you are a 700+ borrower. Your LTV on the investment property side is gonna be 80 or less. They typically look for experience and debt service coverage. That's a pretty binary product. I think what you're looking for is more on the bridge side. On the bridge side, we target borrowers with a history of buying fix and flips, ground-up constructions, as well as rehabs. Typically, we wanna see people with six to seven transactions in the last two years. We are looking for an experienced borrower base. What we notice in this current environment, with rates going up and the cost of financing going up, the less experienced borrowers with less capital are getting weeded out. The very experienced borrowers, the ones that have done five, six, seven projects in the last two years, who have a recent history of being successful, they continue to operate business as usual. What we have noticed the difference is instead of them making a return on equity, say 40-45, they're making a return on equity in the high twenties, low thirties. They're still have demand for financing needs. They're still looking for leverage, and we continue to see strong demand from the experienced market. Touch on a couple more points, Jeff. We do look for fraud. We look for background issues. We look for experience. The last thing is we're very focused on valuation of the property collateral. For us in that bridge RTL space, it's important for us to be accurate on our value of the property. At the end of the day, if the opportunity does not go the way the borrower expects it to go, we have to take back the collateral. We wanna make sure the value is there. Those are big drivers to what we're doing there, Jeff. As a reminder. Does that answer your question? As a reminder to ask a question at this time, please press star one. Please limit to two questions and queue for follow-up questions. We have another question from Matthew Howlett from B. Riley. Please go ahead. Oh, hey. Hey, Jason. Thanks for taking my question. Hey, Matt. Nice to chat. Yeah. I think I heard you say it, but when we look at AAMC's, you know model origination model, I just wanted to hear you talk about it again. What will the, you know, the ROE profile versus what we traditionally see on aggregators, REIT type models. How do you, I mean how do you. It looks like you're gonna generate a higher ROE. I appreciate it, you're not gonna give guidance right now, but when we look at this model from a high level versus what we traditionally see in this space, you know, originate to hold dividends, how are you gonna be differentiated? How is it superior? Will the returns be higher, but will they be more stable over time? Just go over a little bit about, you know, how you're gonna differentiate versus what's out there. Yeah. Look Matt, those are again great questions. I think at the end of the day we gotta take a step back here. When you look at the amount of capital raised in the alternative asset space, it's trillions upon trillions. There's a massive amount of capital that's been raised. In years past, a lot of this capital from the large money managers, insurance companies have gone to the street to buy product. They can't anymore. They're going direct. The way we look at this business is once we get our forward commitments lined up with these large REITs, with these large insurance companies, with these large money managers, they have incredible. I mean, they have you know amongst them trillions of dollars in alternative capital, raised for alternative assets raised. We're doing forward commits, so our goal is to originate on a forward flow basis and have volume be set up by a forward flow. With that being said we're not looking to do open market bidding and putting random pools out there. We're looking to have a scheduled okay $250 million is going here, $500 million is going there. That way we can ramp our volume up and have a much more fluid process for a takeout, because what we want is not lumpy revenues, but we want consistent volume targets. That way we can, you know, ascertain how much demand, how much product we can create and target where it's going. With that being said, I expect once we have our forward flows set up our revenues will increase. We'll continue to look for additional capital partners that have, again, there's large insurance companies out there that have hundreds of billions of dollars. We'll be looking for a continued improvement in our partners for size, for strength, and that will allow our ROE to be much more stable and more forward-looking. Okay. A lot of people originate and they go by trade by trade. Our view is we know who has capital. We're in talks with those partners. These are the largest money managers, the largest insurance companies out there, and our goal is to originate into their portfolio, and that should smooth out our earnings and effectively make it less cyclical. Does that help? Right. Matt? That helps. Right. Look, it's good. It helps a lot that you're gonna be obviously sound like a very robust, you know, growing origination platform. So the capital gets turned over quickly. It's recurring fee income, high cash flows, and you expect to retain investments for just the compounding impact of continuing to grow the origination platform. Is that sort of how I think about the model? Exactly. Exactly, yeah When you look at an insurance company and maybe they have $30 billion in the mortgage space you know, our goal is to line up and be able to sell a $500 million or $1 billion to that particular company. That allows us to have the origination fees in the front. We get a certain amount of spread or premium obtained from the sale. We potentially even have clients who want us to use us for asset management because of our history and our strength in India. The goal is to create this product based on the demand from the fixed income markets that's massive. Our job effectively to go out, create, you know, to reach into that demand, create the product, and distribute it into these large fixed income accounts. Look, it sounds like a compelling opportunity. We'll look for more color. I mean, obviously. We'll wait for more details, but just, can you just give me a general overview? Is everything in terms of, you know, cost to originate and centralization of the origination platform, the credit platform, how is that all gonna be centralized? Just give me a sense on, you know, the underwriting, the credit, and the overall cost. Yeah, look, that's a great question. You know, our underwriting, our processing, the fulfillment, distribution, everything's gonna be done out of India. We have a deep history there. Our team has underwritten, purchased, and asset managed over 30,000 non-performing mortgages, single-family homes, and REOs. It's all done out of there. We have an incredibly talented and experienced team, very highly educated. At the same time, the cost effectiveness there relative to U.S. is, it's very material. And I've been in. You know, my experience being on the street for the last 10 years, I've been in a lot of shops. You know, our advantage in the cost, the cost side is tremendous on that front. When you start looking at we're very data-driven, so we've tested our marketing, our lead generation the last 60 days. We found that even in an adverse market with rates going up and housing concerns around the housing market going down, we find our production's been very good. Our lead generation's been fantastic. Our demand for product's fantastic. The cost-wise, you know, we think our numbers are very good and the demand's there. We feel good with our lead generation cost, our cost structure there. As a whole, we feel that we're in talks with some of the top capital providers out there to buy product. When you sell into the biggest capital aggregators out there, these REITs, these insurance companies, you have a very effective end user cost of capital. Our India operation is very talented, very experienced, as well as very cost-effective. Our tax structure here in the USVI allows us, you know, effectively a competitive advantage because we have, you know, we have a corporate, what's called an EDC tax structure that allows us to be more competitive in pricing and just execution. Overall, we feel between our advantage and experience in expense structure in India, our tax structure in the VI, as well as our partners on the end takeouts, as in our very, I think, very best in class use of data and lead generation, we feel we're gonna be very competitive in this space, very very competitive across the different products that we originate. Well, I'll hop back in. We look forward to hearing, you know, more disclosures. I'll tell you, there's not a lot of comps out there in the public market and, you know, this alternative lending space is growing bigger and bigger. You know, certainly look forward to, you know, hearing more about the model on the differentiation relative to the REIT group that's. I think you're right, Matt. I think when you look at it, a lot of the early movers in the bridge and transitional space got bought up quickly by. Right. Again, large money managers. I'm not gonna name names, but there's well-known household accounts that went out and bought a lot of our peers because the opportunity they see, they have the demand in alternative assets, and they've acquired them. There aren't really any I don't know of any originate to distribute alternative asset originator out there. We're very excited because we feel like we're in a good space that a lot of companies have been bought at some very attractive earnings. That, you know, earnings and we feel as a public company, we have a lot of runway, so. Just real quick. Sorry, Matt. Where do you put the overall market size? I know it's a broad question, but just curious how you look at the market. I know clearly there's a huge You said size-wise for products? Yes. Look, you gotta look at each product. When you look at single-family bridge, fix and flip/ground construction, it's a. There's no one data source. I think generally speaking, in normalized years, it's between $60 billion and $80 billion. It's generally speaking, that's the numbers that are thrown out. That's just for the single-family, okay. $60 billion-$80 billion. When you start looking at multifamily bridge and value, that's another $80 billion-$100 billion. When you look at the DSCR investment property space, there's 19 million rental properties out there. 19 million. That's by the census tract. The DSCR space is massive, okay? Effectively, everybody knows this, but when you look at the GSEs and banks, their model is kind of dated when it comes to income documentation and how they evaluate credit and real estate. That's another situation that creates a great opportunity for us because the investment property/business purpose space doesn't really flow into the GSEs or banks. The size of the market's pretty massive. I think it's undervalued, how big. Hopefully, does that help? Yeah. No, it helps. Fair amount. It helps, and it's just, you know you hear you pick up the newspaper every day, and you read about, you know, institutions gonna buy more single family. You know, it's just like the industry just seems like it's gonna be absolutely enormous. Like I said, nothing publicly traded. Yeah. In your model. Yeah, nothing publicly traded. At the same time, it's well known that there's a housing shortage in the U.S., and the number is anywhere from 4 million-6 million houses, the shortage. That's just affordable housing. Affordable housing is definitely a key driver in what we're doing. A lot of millennials are starting to buy housing and have families. There's a tremendous growth opportunity. We've seen it for the last 10 years, the space grow from nothing, a cottage industry to being much more institutional. Frankly, there's demand by borrowers, builders, real estate investors, as well as rental property owners. There's also a tremendous amount of demand in the fixed income market. On both sides, we're seeing demand. We think it's a great opportunity. It's a space that's not very institutional per se, so there's a lot of areas where there's friction and ability for us to come in and take our experience and apply it and create something that's very special. Good. I certainly look forward to hearing more about your strategy. Thanks a lot, Jason Kopcak. Thanks, man. As a reminder, to ask a question at this time, please press star one. Please ensure the mute button on your telephone is switched off to allow your signal to reach our equipment. We will take a follow-up question from Jeff Moore from Burr Oak Capital. Please go ahead. Hey, Jason. Okay, those numbers that you were saying to the last caller about the TAM, the total market size. It sounds like your all's yearly origination is going to be less than a half of a percent of that. Did I hear that right? Yeah. I mean, look, the numbers we threw out, $600 million. Do I think we can originate more than that? Absolutely. The amount that we put out there, the $600 million. You're right. It's less than 0.5%. The ability to scale in the market is there. It's huge. That's one of the reasons we're very excited. Okay. Yeah. I mean, you guys really aren't even, like, advertising for loans and stuff yet. I mean, like, on Instagram or whatever. I mean, even Twitter, I'll have like, you know, CoreVest or, you know, Kiavi or people, like, advertise to me since I do some real estate. Like, I haven't seen anything from you all. Like, you all think you can do that. Right. Without really even advertising, I guess, right? Yeah, exactly, Jeff. We've done an analysis. We had a third party who we feel is very credible, very institutional, do an analysis of the amount of marketing that's getting done in the business purpose space. We feel, one, between their market analysis and, two, the testing that we've done over the last 60 days, we feel that our ability to scale is very material. Like, we can scale in a massive way. Before we do that, we're trying to get our takeout set up. By getting our takeout set up for the different channels, then we can. You know, getting our back office up and running, which is up and running, then we can go turn on the marketing, go do what we need to do, and create the product that we're gonna distribute. We don't want to. We feel, one, that we have a good handle on how big the market is and how quickly and how much it's gonna cost per loan to create each loan in each space. We've done that analysis. We feel good about it. Frankly, I wanna. If I could spend the money yesterday, I would've spent the money yesterday to turn it up. We need to get the takeout set up. Once we get the takeout set up, I think our volume number is gonna be more than proved out across DSCR, across bridge fix and flip, as well as even multifamily. You know, there's a tremendous opportunity in that multifamily bridge and value add space between the $1 million and $7 million note size, notional size. Yeah. Just as a note, I was unaware that the way you were setting these things up were, like, basically for predetermined amounts for the buyers, right? So you're not Like you said, you're not subject to an auction model, and it should make your cash flows much more predictable. Which is, I mean, reassuring, for me, I guess, as an investor. I mean, I was already pretty. We want. Pretty excited about what you guys are doing. We wanna be systematic. The goal is to make a systematic programmatic business. It's not a trade. This is a business. We feel like the opportunity is massive between, you know. Again, you have to look at this paper's not going to agencies. They're kind of archaic in the way they look at values and income documentation. We feel there's a massive opportunity there. When you look at the housing shortage, but it affects single-family homes as well as multi-families. We see that there. We feel very good that if we create the right partnerships with end takeouts that we're gonna be able to scale this very systematically. This is a business model, this is not a trade. We're very excited that our earnings will be a lot more smoother than going out and buying one-off trades. Anyways, yes. To answer your questions, yes. Cool. Okay. Well, I have one more kind of multi-part question. It looks like going through your queue that you had about $13.2 million in principal repayment, and you repaid like two, call it $2.2 million of borrowed funds. I'm assuming that's on your warehouse. It looks like you marked down like $1.5 million in loans. Can you talk about that slight markdown you had in the value of the loans? Also the principal repayment. I mean, if you got back $13.2 million in principal repayment last quarter, but you haven't had these things on your books very long, it seems like Well over 10% of your loans have already paid you back that you've only had on your books for a couple of months. Is that accurate? Kind of what are your thoughts going forward on a loan? Yeah. No, that's pretty astute. I think at the end of the day, we bought. Look, step back, you got a couple different questions there. We bought some seasoned paper in the very beginning, and we buy seasoned paper and bridge. Keep in mind, the paper that we're buying and originating is, generally speaking, 12 months or less in duration, okay? In a rising rate environment, in my view, that's very good paper because you're not in it long term. With that being said, we also bought some seasoned paper, and when I say seasoned, it might have been four or five months seasoned. Yeah, some of that paper's paid off, and then we expected that. The goal was to demonstrate that we're in the space, create some income, and we did that. Those loans, some of those loans are already paying off, number one. Number two, this paper does pay off quick. You know, experienced borrowers do pay off quick. Generally speaking, in the bridge space, you're looking at 11 months as the average life expectancy of the bridge loan. One of the hard part is you constantly gotta replenish your inventory. On the flip side, we want that in a rising rate environment. That's played to exactly how we thought it'd play out, number one. Number two, mark. We try to talk about marking. As rates go up you know you mark your portfolio relative to the rates, you know, to the discount rate in the market. We've taken some book losses on that front, but the stuff's paid off. We're Effectively, where we financed it at and where we bought it at, we're still making money. As a whole, our book is very profitable. We have about, at the end of the quarter, approximately $50 million in cash that we have bought loans in or originated loans into cash. Not all of our portfolio is financed through the warehouse line. We have a fair amount of portfolio that was held in cash and a fair amount on the warehouse line. That's why the paydowns per 9/30 weren't respectively, you know, because not 100% is financed. Again, some of it's paid off in cash, some it's paid off on our warehouse line. Does that answer your question, Jeff? Yeah, man I. That's awesome. I'm super excited for you guys. One more thing, Jeff. When we bought loans with cash, part of the reason is too, to keep in mind, is we're just getting the business going. Originations take time. When you build an origination platform, you don't just flip a switch and you start originating tomorrow. It takes time to get your underwriting, your sales people hired, your marketing going. We had to go out and buy closed loans to slow down our cash burn to effectively get processes in place. The goal originally, we knew we were gonna buy closed loans because we had different areas that we wanted to address. Long term, that was never the goal was to aggregate. That definitely, it's helped us tremendously in creating revenues, slowing down our cash burn, getting our processes in place, allow us to get a warehouse line in place. It allowed us to look at other warehouse lines. By buying closed loans and by originating with our cash, it's helped us a ton. At the same time, our business model is not to hold loans. Going forward, we will originate to sell. That's our plan, always has been, and it's gonna be our plan. O-okay. Okay, Jeff. I know I said I'd only have one. Sorry. Yeah, I know I said I only have one more question, but I guess I lied because you did such a good job at talking that you made me think of one other thing. The warehouse line you've got, it's for $50 million or whatever. It seems very obvious that based on the partners you're getting to buy these loans and how they're saying, "Hey, we want $20 million of these or $5 million of these," or however much they want, you know, on a weekly, monthly, yearly basis or whatever. Given that you're only gonna be taking up less than 0.5% of the market, the numbers you're throwing out, when are you gonna, like, outgrow that warehouse facility? Because it seems like you could do that very easily. I mean, anyone that looks at your resume, like, can figure out you know everybody in this space. Like, at what point does $50 million, you know, plus the $50 million or so or $60 million you guys have in cash, in investments you own. Like, when does that become not enough for you all? No. First off, thanks for the compliment, number one. number two is well aware of it. Like we're already going down a path on a second line. The reality is that getting these takeouts set up, if you do this properly, we should be able, in an ideal world, sweep loans every three days. You could take $50 million, and you really could do a lot with $50 million. However, with the volumes that we have expectations, with our ability to market, with our back office operations, our view is we're gonna need a lot more warehouse line. We are working on that right now, but the fact of the matter is priority is selling loans and get our partnerships for the different products set up. In parallel, yes, we're looking at other warehouse lines. Our current partner, Flagstar, is a great partner. I'm sure they'll increase our lines as we demonstrate velocity. On the flip side, we are very focused on selling loans. In an ideal world, I wanna sell loans every three days. As you can do the math, $50 million, you're returning loans every three to five days. There's room to really turn those lines over to really leverage those lines. We don't need those today just yet, but we're addressing it. We see the need for warehouse lines to be. It's a greater need. Cool. Well, Does that answer your question, Jeff? I'm sorry. Yeah. I'm really looking forward to more updates from y'all. Y'all are doing everything amazingly well. I'm super excited for y'all. I appreciate that. Thanks for the time. Thanks, Jeff. As there are no other questions in the queue, we'll answer a couple of questions that came in prior to the call. A lot of which have been addressed already, but there's a few that are still outstanding. Jason, how do you monitor the health of your loan book? Look, we have some processes in place. We have, again, an extremely experienced asset management team in India. We do weekly reviews of our portfolio. Any loan that's slow playing, you know, payments due on, say, for example, the tenth, if it's not been made, we have our asset management team sits on top of the servicers, and they have the servicers reaching out to borrowers. These are, again, real estate investors, builders. We have them prodding them to make their payments. We even have an aggressive door knock. You know, we send somebody out to tap the person on the shoulder, make a payment. We're all over the servicing of these loans. To date, our book's very healthy. At the same time, you know, we're actively reviewing it on a weekly basis, and that's it. It's been very good. It's helped our portfolio stay very safe performing, so. Furthermore, just to kind of, I think I mentioned this earlier, but with the headwinds in the real estate market and the concerns around real estate market. On the bridge space side, we lowered our LTCs and LTVs by 10 points, and the view was that the days on market and housing should take a little longer. We had historically short levels on days on market a year ago from the historically low interest rates. With rising rates and a slowing down of the housing, we figured by lowering our LTCs and our LTVs, we would be cautious by entering into bridge loans. That should make it more attractive for our end buyers to buy. It's worked out so far, so. What does your average borrower look like? Our average borrower on the bridge side is effectively a builder or a real estate investor that we target, as I mentioned earlier, six. We want a borrower who's done six to seven flips or renovations in the last 24 months. That's our target audience. We have people in there who have done 30, 40, and we have people that have done four, three or four. Our target's around seven for the flip bridge business. When you look at the DSCR rental side, ideal world, we like to see people that have at least a minimum of two to three rental properties. If there's a lower LTV involved, we'll do some amount of first time rental. For the most part, we wanna see a borrower with two to three properties that they have experience renting out. Why would someone use us, AAMC, as opposed to another lender? Well, again, I think the one question is why wouldn't somebody go to a bank first before us? Speed, experience, the access to. You know, we can customize product and distribute it. You know, typically, when you're working with a bank, they just. That's not their specialty. That's not what they do. This is what we do for a living. We have a lot of outlets. We understand what can get done and where it can go, number one. Two is speed. Like, we can close quick. If it's a good opportunity and we like the opportunity, we can close quick, much quicker than a bank can. That's just that. That's two main reasons. The other part is bespoke. A lot of what we do is more customized. What you'll find is if you go to a bank, you either fit the credit box they provide or the real estate box they provide, otherwise you don't fit. Here, we look at it, we try to figure out how to get it done and execute in a bespoke manner. You talked about this a little bit earlier, but what do companies in this space trade for in the market? Again, these are as I mentioned earlier to Matt, a lot of these companies are private. A lot of our peers were private and got bought by larger money managers. Generally speaking, the proven platforms have traded at a 9-12x net income multiple. Again, these are private transactions, so it's hard to point to public. I've been around in and around this space for 10 years now, and there's been quite a few trades where money managers or hedge funds come in and bought a platform at a 9-12x net income earnings. Have you considered using baby bonds for raising capital? You know, look, for us, ultimately, we have looked at different forms of debt because we're gonna need to grow our warehouse book and there's gonna be some growth capital we need at some point to grow the originations. We're definitely looking at it. We haven't done anything yet, but we are looking at that market and we are open to gathering information. What we are focused on is our takeouts right now. Is the company looking to buy back any additional shares since the Putnam transaction? Look, I think at the end of the day, once we start selling on a forward basis, on a programmatic regular basis, we start selling our originations, that's the most important focus, as I keep saying throughout this call. Once we have that established, the ability to go back, buy back stock or do other creative actions that benefit shareholders is always in front of us and we'll definitely consider it. Just a couple of questions on the general market. How long do you expect it to take for margins to rebound or be normalized in the sector? Look, I don't have a crystal ball. I think, I don't think anybody has a crystal ball. The view is we're in for a longer process to kind of fix the economy. With that being said, clarity on where rates are headed, clarity on borrower behavior, clarity on unemployment and housing are all major factors right now. What we're seeing is the securitization market's definitely froze up, and that's caused some limited liquidity, but insurance and banks have a ton of money, and we see them actively participating. I think, a more normalization or stable environment will probably happen over the next six to nine months, and that will just create more liquidity, which should effectively expand our margins. I feel in the current environment, we still can earn a very good return on equity, very attractive to what we expect. When the market stabilizes, our margins should widen out more. I think. Look, Kevin, that was. I think that's the only questions we have. I appreciate everybody's time today. You know, we're very excited about the business. We're very happy with what we've gotten accomplished in the five or so months since I've been here. We have a tremendous team. You know, I wanna thank my people in India. They're incredibly important to what we do. The team in Tampa have been nothing but a blessing. St. Croix, these are good people. I'm very thankful for who we have and what we've accomplished in the last five-plus months. Look forward to continue the growth and push the business forward. Kevin, I think I'm it. That's all I have. Yeah. If you have a question we weren't able to get to in the session or didn't get to submit, please don't hesitate to reach out to our investor relations email or phone number. Thanks. Thank you. That will conclude today's conference call. Thank you for your participation, ladies and gentlemen. You may now disconnect.