Document and Entity Information
Document and Entity Information - USD ($) $ in Thousands, shares in Millions | 12 Months Ended | |
Dec. 31, 2022 | Feb. 28, 2023 | |
Cover [Abstract] | ||
Document Type | 10-K | |
Amendment Flag | false | |
Document Period End Date | Dec. 31, 2022 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | FY | |
No Trading Symbol Flag | true | |
Title of 12(g) Security | Limited Partnership Interests | |
Entity Registrant Name | REDWOOD MORTGAGE INVESTORS VIII, L.P. | |
Entity Central Index Key | 0000889123 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding | 57.5 | |
Entity Current Reporting Status | Yes | |
ICFR Auditor Attestation Flag | false | |
Entity Interactive Data Current | Yes | |
Entity Voluntary Filers | No | |
well-known seasoned issuer | No | |
Entity Shell Company | false | |
Document Annual Report | true | |
Document Transition Report | false | |
Entity File Number | 000-27816 | |
Entity Incorporation, State or Country Code | CA | |
Entity Tax Identification Number | 94-3158788 | |
Entity Address, Address Line One | 177 Bovet Road | |
Entity Address, Address Line Two | Suite 520 | |
Entity Address, City or Town | San Mateo | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 94402 | |
City Area Code | 650 | |
Local Phone Number | 365-5341 | |
Entity Public Float | $ 0 | |
Auditor Firm ID | 243 | |
Auditor Name | BDO USA, LLP | |
Auditor Location | San Francisco, California |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
ASSETS | ||
Cash, in banks | $ 963 | $ 3,903 |
Loan payments in trust | 0 | 490 |
Principal | 60,088 | 55,099 |
Advances | 59 | 116 |
Accrued interest | 570 | 459 |
Prepaid interest | (496) | 0 |
Loan balances secured by deeds of trust | 60,221 | 55,674 |
Allowance for loan losses | (55) | (55) |
Loan balances secured by deeds of trust, net | 60,166 | 55,619 |
Receivable from related party (Note 3) | 68 | 0 |
Real estate owned (REO), net | 5,911 | 8,258 |
Debt issuance costs, net | 36 | 13 |
Other assets | 49 | 87 |
Total assets | 67,193 | 68,370 |
LIABILITIES AND PARTNERS' CAPITAL | ||
Accounts payable | 284 | 195 |
Accrued liabilities | 1,103 | 1,107 |
Line of credit | 10,000 | 0 |
Payable to related party (Note 3) | 154 | 47 |
Mortgages payable | 1,347 | 1,453 |
Total liabilities | 12,888 | 2,802 |
Commitments and Contingencies (Note 8) | ||
Partners’ capital | ||
Limited partners’ capital | 57,616 | 69,555 |
General partners’ deficit | (609) | (626) |
Total partners’ capital | 57,007 | 68,929 |
Receivable from manager (formation loan) | (2,702) | (3,361) |
Partners’ capital, net of formation loan | 54,305 | 65,568 |
Total liabilities and partners’ capital | $ 67,193 | $ 68,370 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Revenue | ||
Interest income | $ 5,045 | $ 7,055 |
Interest expense | ||
Line of credit | (522) | (379) |
Mortgages payable | (52) | (85) |
Total interest expense | (574) | (464) |
Net interest income | 4,471 | 6,591 |
Late fees | 75 | 57 |
Gain on sale, loans | 122 | 0 |
Total revenue, net | 4,668 | 6,648 |
Provision for loan losses | 0 | 5 |
Operations expense | ||
Mortgage servicing fees | 1,004 | 1,089 |
Asset management fees | 242 | 290 |
Costs from Redwood Mortgage Corp. | 707 | 695 |
Professional services | 1,138 | 1,083 |
REO, net (Note 5) | (113) | 514 |
Other | 33 | 43 |
Total operations expense | 3,011 | 3,714 |
Net income | 1,657 | 2,929 |
Limited partners (99%) | 1,640 | 2,900 |
General partners (1%) | $ 17 | $ 29 |
Consolidated Statements of In_2
Consolidated Statements of Income (Parenthetical) - Redwood Mortgage Investors VIII [Member] | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Limited partners | 99% | |
General partners | 1% | |
General Partner [Member] | ||
General partners | 1% | |
Limited Partner [Member] | ||
Limited partners | 99% |
Consolidated Statements of Chan
Consolidated Statements of Changes in Partners' Capital - USD ($) $ in Thousands | Total | Capital Subject to Withdrawals Net [Member] Limited Partner [Member] | Partners Capital (Deficit) [Member] General Partner [Member] | Capital Units [Member] |
Beginning balance at Dec. 31, 2020 | $ 82,991 | $ (655) | $ 82,336 | |
Net income | $ 2,929 | 2,900 | 29 | 2,929 |
Distributions | 1,553 | 1,553 | ||
Withdrawals | (14,783) | (14,783) | ||
Ending balance at Dec. 31, 2021 | 65,568 | 69,555 | (626) | 68,929 |
Net income | 1,657 | 1,640 | 17 | 1,657 |
Distributions | (1,137) | (1,137) | ||
Withdrawals | (12,442) | (12,442) | ||
Ending balance at Dec. 31, 2022 | $ 54,305 | $ 57,616 | $ (609) | $ 57,007 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Operating activities | ||
Interest income received | $ 5,393,000 | $ 7,312,000 |
Interest expense | (568,000) | (379,000) |
Late fees and other loan income | 100,000 | 147,000 |
Operations expense | (3,191,000) | 3,159,000 |
Total cash provided by operating activities | 1,734,000 | 3,921,000 |
Investing activities | ||
Loans funded | (48,419,000) | (25,248,000) |
Principal collected | 30,877,000 | 38,940,000 |
Loan transferred from related mortgage fund | 0 | 1,371,000 |
Loans transferred to related mortgage fund | 3,284,000 | 5,711,000 |
Loans sold to non-affiliate | 9,893,000 | 485,000 |
Advances collected | 57,000 | 48,000 |
Total - Loans | (4,308,000) | (18,565,000) |
REO - sales proceeds, net | 2,716,000 | 216,000 |
Total cash (used in) provided by investing activities | (1,592,000) | 18,781,000 |
Partners’ capital | ||
Partner withdrawals, net of early withdrawal penalties | (12,316,000) | 14,627,000 |
Early withdrawal penalties | (126,000) | 0 |
Partner distributions | (1,137,000) | (1,553,000) |
Cash distributions to partners, net | (13,579,000) | 16,180,000 |
Advances | 11,000,000 | 16,847,000 |
Repayments | (1,000,000) | 19,300,000 |
Debt issuance costs | (57,000) | 0 |
Cash provided by (used in) line of credit | 9,943,000 | (2,453,000) |
Promissory note received from related party | 1,000,000 | 0 |
Promissory note repaid to related party | (1,000,000) | 0 |
Mortgages repaid | (105,000) | (996,000) |
RMC payments - formation loan | 659,000 | 466,000 |
Total cash used in financing activities | (3,082,000) | (19,163,000) |
Net (decrease) increase in cash | (2,940,000) | 3,539,000 |
Cash, beginning of period | 3,903,000 | 364,000 |
Cash, end of period | 963,000 | 3,903,000 |
Net income | 1,657,000 | 2,929,000 |
Adjustments to reconcile net income to net cash provided by operating activities | ||
Gain on sale, loans | (122,000) | 0 |
Provision for loan losses | 0 | 5,000 |
Amortization of debt issuance costs | 34,000 | 54,000 |
REO – gain on disposal | (108,000) | (79,000) |
REO - (decrease) increase in valuation allowance | (261,000) | 294,000 |
Change in operating assets and liabilities | ||
Loan payments in trust | (25,000) | (90,000) |
Accrued interest | (149,000) | (257,000) |
Prepaid interest | 496,000 | |
Receivable from related party | (68,000) | 2,000 |
Other assets | 38,000 | (30,000) |
Accounts payable and accrued liabilities | 85,000 | 352,000 |
Payable to related party | 107,000 | 47,000 |
Total cash provided by operating activities | $ 1,734,000 | $ 3,921,000 |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Parenthetical) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Statement of Cash Flows [Abstract] | ||
Non cash financing activity in early withdrawal penalties | $ 0 | $ 156,000 |
Organization and General
Organization and General | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Organization and General | NOTE 1 – ORGANIZATION AND GENERAL Redwood Mortgage Investors VIII, L.P., a California Limited Partnership (“RMI VIII” or “the partnership”), was formed in 1993 to engage in business as a mortgage lender and investor by making and holding-for-investment mortgage loans secured by California real estate, primarily by first and second deeds of trust. The partnership is externally managed by Redwood Mortgage Corp. (“RMC” or “the manager”). The general partners are RMC and Michael R. Burwell, the President, Secretary and Treasurer of RMC and its principal shareholder. RMC provides the personnel and services necessary to conduct the business as RMI VIII has no employees of its own. The general partners are entitled to one percent ( 1 %) of profits or loss of the partnership. The mortgage loans the partnership funds and/or invests in, are arranged and generally are serviced by RMC. The rights, duties, and powers of the limited partners and general partners of the partnership are governed by the Limited Partnership Agreement (“Partnership Agreement”). Limited partners representing a majority of the outstanding units may, without the consent of the general partners, vote to: (i) dissolve the partnership; (ii) amend the Partnership Agreement subject to certain limitations; (iii) approve or disapprove the sale of all or substantially all of the assets of the partnership; and (iv) remove or replace one or all of the general partners. A majority in interest of partnership units is required to elect a new general partner to continue the partnership business after a general partner ceases to be a general partner due to its withdrawal. The following is a summary of certain provisions of the Partnership Agreement and is qualified in its entirety by the terms of the Partnership Agreement itself. Limited partners should refer to the Partnership Agreement for complete disclosure of its provisions. The manager is responsible for managing the business and affairs of RMI VIII, subject to the voting rights of the partners on specified matters. The manager acting alone has the power and authority to act for and bind the partnership. RMC is entitled to fees and reimbursements of qualifying costs as specified in the Partnership Agreement. The partnership’s primary investment objectives are to: • yield a high rate of return from mortgage lending, after the payment of certain fees and expenses to the general partners and their related mortgage funds; and • preserve and protect the partnership’s capital Net income (losses) are allocated among the limited partners according to their respective capital accounts after one percent (1%) of the net income (losses) are allocated to the general partners. Investors should not expect the partnership to provide tax benefits of the type commonly associated with limited partnership tax shelter investments. The partnership’s net income, cash available for distribution, and net-distribution rate fluctuates depending on: • loan origination volume and the balance of capital available to lend; • the current and future interest rates negotiated with borrowers; • line of credit advances, repayments and the interest rate thereon; • loan sales to unaffiliated third parties, and any gains received thereon; • the amount of fees and cost reimbursements to RMC; • the timing and amount of other operation expense; and • the timing and amount of payments from RMC on the formation loan. Federal and state income taxes are the obligation of the partners, other than the annual California franchise tax and the California LLC cash receipts taxes paid by the partnership’s subsidiaries. The tax basis in the net assets of the partnership differs from book basis by the amount of the allowance for loan losses and the amount of the valuation allowance for real estate owned. The ongoing sources of funds for loans are the proceeds (net of withdrawals from limited partners’ capital accounts and operation expense) from: • loan payoffs; • borrowers’ monthly principal and interest payments; • line of credit advances; • loan sales to unaffiliated third parties; • REO sales; • payments from RMC on the outstanding balance of the formation loan; and • earnings retained (i.e., not distributed) in partners’ capital accounts. The partnership intends to hold until maturity the loans in which it invests and does not presently intend to invest in mortgage loans primarily for the purpose of reselling such loans in the ordinary course of business; however, the partnership may sell mortgage loans (or fractional interests therein) when the manager determines that it appears to be advantageous for the partnership to do so, based upon then current interest rates, the length of time that the loan has been held by the partnership, the partnership’s credit risk and concentration risk and the overall investment objectives of the partnership. Loans sold to third parties may be sold for par, at a premium or, in the case of non-performing or under performing loans, at a discount. Partnership loans may be sold to third parties or to the manager or its related mortgage funds; however, any loan sold to the manager or a related mortgage fund thereof will be sold for a purchase price equal to the greater of (i) the par value of the loan or (ii) the fair market value of the loan. The manager will not receive commissions or broker fees with respect to loan sales conducted for the partnership; however, selling loans will increase partnership capital available for investing in new loans for which the manager will earn brokerage fees and other forms of compensation. Distribution to limited partners At the time of their subscription to the partnership, limited partners elected either to receive monthly, quarterly or annual cash distributions from the partnership, or to compound income in their capital account. If an investor initially elected to receive monthly, quarterly or annual distributions, such election, once made, is irrevocable. If the investor initially elected to compound income in their capital account, in lieu of cash distributions, the investor may, after three (3) years, change the election and receive monthly, quarterly or annual cash distributions. Income allocable to limited partners who elect to compound income in their capital account will be retained by the partnership for making further loans or for other proper partnership purposes and such amounts will be added to such limited partners’ capital accounts. The percentage of limited partners electing distribution of allocated net income, by weighted average to total partners’ capital was 55 % at December 31, 2022 and 58 % at December 31, 2021. Capital withdrawals and early withdrawals There are substantial restrictions on transferability of units, and there is no established public trading and/or secondary market for the units. To provide liquidity to limited partners, the Partnership Agreement provides that limited partners, after the minimum five-year period, may withdraw all or a portion of their capital accounts in 20 quarterly installments or longer, as determined by the general partners in light of partnership cash flow, beginning the last day of the calendar quarter following the quarter in which the notice of withdrawal is given. A limited partner may liquidate all or a part of the limited partner’s capital account in four quarterly installments beginning on the last day of the calendar quarter following the quarter in which the notice of withdrawal is given, subject to a 10 % early withdrawal penalty applicable to any sums withdrawn prior to the time when such sums could have been withdrawn without penalty. There is a limited right of accelerated liquidation for an investor’s heirs upon an investor’s death. The partnership has not established a cash reserve from which to fund withdrawals and, accordingly, the partnership’s capacity to return a limited partner’s capital is subject to the availability of partnership cash. The general partner is under no obligation to sell loans from the portfolio in order to honor withdrawal requests, and the program can be restricted or suspended at any time. Cash flow is considered to be available only after all current partnership expenses have been paid (including compensation to the general partners and related mortgage funds) and adequate provision has been made for the payment of all periodic cash distributions on a pro rata basis which must be paid to limited partners who elected to receive such distributions upon subscription for units. Per the Partnership Agreement, no more than 20 % of the total limited partners’ capital account balances at the beginning of any year may be liquidated during any calendar year. Notwithstanding this 20% limitation, the general partners have the discretion to further limit the percentage of total limited partners’ capital accounts that may be withdrawn in order to comply with the safe harbor provisions of the regulations under Section 7704 of the Internal Revenue Code of 1986, as amended, to avoid the partnership being taxed as a corporation. If notices of withdrawal in excess of these limitations are received by the general partners, the priority of distributions among limited partners is determined as follows: first to those limited partners withdrawing capital accounts according to the 20 quarter or longer installment liquidation period, then to benefit plan investors withdrawing capital accounts after five years over four quarterly installments, then to executors, heirs, and other administrators withdrawing capital accounts upon the death of a limited partner and finally to all other limited partners withdrawing capital accounts. Except as provided above, withdrawal requests will be considered by the general partners in the order received . In the event the current level of withdrawal requests by limited partners continues, the general partners may elect to restrict or suspend future capital withdrawals, as permitted by the terms of the Partnership Agreement. Term of the partnership The partnership will continue until 2032, unless sooner terminated as provided in the Partnership Agreement. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of presentation The financial statements are prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The partnership’s consolidated financial statements include the accounts of the partnership and its wholly-owned subsidiaries (consisting of single-member limited liability companies owning a single real property asset). All significant intercompany transactions and balances have been eliminated in consolidation. Management estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions about the reported amounts of assets and liabilities, and disclosures of contingent assets and liabilities, at the dates of the financial statements and the reported amounts of revenues and expenses during the reported periods. Such estimates involve significant level of uncertainty and have had or are reasonably likely to have a material impact on the partnership’s financial condition or results of operations. Such estimates relate principally to the determination of the allowance for loan losses, including the valuation of impaired loans (which itself requires determining the fair value of the collateral), and the valuation of real estate owned, at acquisition and subsequently. Actual results could differ materially from these estimates. Fair value estimates GAAP defines fair value as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. An orderly transaction is a transaction that assumes exposure to the market for a period prior to the measurement date to allow for marketing activities that are usual and customary for transactions involving such assets and liabilities; it is not a forced transaction. Market participants are buyers and sellers in the principal market that are (i) independent, (ii) knowledgeable, (iii) able to transact and (iv) willing to transact. Fair values of assets and liabilities are determined based on the fair value hierarchy established in GAAP. The hierarchy is comprised of three levels of inputs to be used. • Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the partnership has the ability to access at the measurement date. An active market is a market in which transactions occur with sufficient frequency and volume to provide pricing information on an ongoing basis. • Level 2 inputs are inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly in active markets and quoted prices for identical assets or liabilities that are not active, and inputs other than quoted prices that are observable or inputs derived from or corroborated by market data. • Level 3 inputs are unobservable inputs for the asset or liability. Unobservable inputs reflect the partnership’s own assumptions about the assumptions market participants would use in pricing the asset or liability (including assumptions about risk). Unobservable inputs are developed based on the best information available in the circumstances and may include the partnership’s own data. The fair value of real property is determined by exercise of judgment based on management’s experience informed by appraisals (by licensed appraisers), brokers’ opinion of values, and publicly available information on in-market transactions. Appraisals of commercial real property generally present three approaches to estimating value: 1) market comparables or sales approach; 2) cost to replace; and 3) capitalized cash flows or income approach. These approaches may or may not result in a common, single value. The market-comparables approach may yield several different values depending on certain basic assumptions, including the consideration of adjustments made for any attributes specific to the real estate. Management has the requisite familiarity with the markets it lends in generally and of the properties lent on specifically to analyze sales-comparables and assess their suitability/applicability. Management is acquainted with market participants – investors, developers, brokers, lenders – that are useful, relevant secondary sources of data and information regarding valuation and valuation variability. These secondary sources may have familiarity with and perspectives on pending transactions, successful strategies to optimize value, and the history and details of specific properties – on and off the market – that enhance the process and analysis that is particularly and principally germane to establishing value in distressed markets and/or property types. Cash in banks Certain of the partnership’s cash balances in banks exceed federally insured limits of $ 250 thousand. The bank or banks in which funds are deposited are reviewed periodically for their general creditworthiness/investment grade credit rating. See Note 7 (Line of Credit) for compensating balance arrangements. Loans and interest income Performing loans are carried at amortized cost, which is generally equal to the unpaid principal balance (principal). Management has discretion to pay amounts (advances) to third parties on behalf of borrowers to protect the partnership’s interest in the loan. Advances include, but are not limited to, the payment of interest and principal on a senior lien to prevent foreclosure by the senior lien holder, property taxes, insurance premiums, and attorney fees. Advances generally are stated at the amounts paid out on the borrower’s behalf and any accrued interest on amounts paid out, until repaid by the borrower. For performing loans, interest is accrued daily on the principal plus advances, if any. Non-performing loans (i.e., loans with a payment in arrears) less than 180 days delinquent continue to recognize interest income as long as the loan is in the process of collection and is considered to be well-secured. Non-performing loans are placed on non-accrual status if 180 days delinquent or earlier if management determines that the primary source of repayment will come from the foreclosure and subsequent sale of the collateral securing the loan (which usually occurs when a notice of sale is filed) or when the loan is no longer considered well-secured. When a loan is placed on non-accrual status, the accrual of interest is discontinued; however, previously recorded interest is not reversed. A loan may return to accrual status when all delinquent interest and principal payments become current in accordance with the terms of the loan agreement. Late fees are recognized in the period received. The partnership may fund a specific loan origination net of an interest reserve ( one to two years ) to insure timely interest payments at the inception of the loan. Any interest reserve is amortized over the period that the amount is prepaid. In the event of an early loan payoff, any unapplied interest reserves would be first applied to any accrued but unpaid interest and then as a reduction of principal. In the normal course of the partnership’s operations, performing loans that are maturing or have matured may be renewed at then current market rates of interest and terms for new loans. From time to time, the manager negotiates and enters into loan modifications with borrowers whose loans are delinquent (non-performing). If a borrower is experiencing financial difficulties and a loan modification were to result in an economic concession to the borrower (i.e., a significant delay or reduction in cash flows compared to the original note), the modification is deemed a troubled debt restructuring (“TDR”). The partnership funds loans with the intent to hold the loans until maturity. From time to time the partnership may sell certain loans. Loans are classified as held-for-sale once a decision has been made to sell loans and the loans held-for-sale have been identified. Loans classified as held for sale are carried at the lower of cost or fair value. Pursuant to California regulatory requirements borrower payments are deposited into a trust account established by RMC with an independent bank and are presented on the balance sheet as “Loan payments in trust”. Funds are disbursed to the partnership as collected which can range from same day for wire transfers and up to two weeks after deposit for checks. Allowance for loan losses Loans and the related accrued interest and advances (i.e., the loan balance) are analyzed on a periodic basis for ultimate recoverability. Collateral fair values are reviewed quarterly and the protective equity for each loan is computed. As used herein, “protective equity” is the dollar amount by which the net realizable value (i.e., fair value less the cost to sell) of the collateral, net of any senior liens, exceeds the loan balance, where “loan balance” is the sum of the unpaid principal, advances and the recorded interest thereon. If based upon current information and events, it is probable the partnership will be unable to collect all amounts due according to the contractual terms of the loan agreement, then a loan may be designated as impaired. An insignificant delay or insignificant shortfall in the amount of payments does not constitute non-performance with the contractual terms of the original loan agreement if the manager expects to collect the amounts due including interest accrued at the contractual interest rate for the period of delay. In determining the probability that the borrower will not substantially perform according to the terms of the original loan agreement, the manager considers the following: • payment status – if payments are in arrears 90+ days (typically 3 payments past due) loans are designated impaired unless resolution of the delinquency is forthcoming without significant delay; • bankruptcy – if the borrower files bankruptcy, the loan is designated impaired; • notice of sale – if the partnership files a notice of sale, the loan is designated impaired. Payments on loans designated impaired are applied to late fees, then to the accrued interest, then to advances, and lastly to principal. For loans that are deemed to be collateral dependent for repayment, a provision for loan losses is recorded to adjust the allowance for loan losses (principal and/or recorded interest) in an amount such that the net carrying amount (unpaid principal less the specific allowance) is reduced to the lower of the loan balance or the estimated fair value of the related collateral, net of any costs to sell and net of any senior debt and claims. The partnership charges off uncollectible loans and related receivables directly to the allowance account once it is determined the full amount is not collectible. Any amounts collected after a charge off is deemed a recovery of loan losses. If the loan goes to foreclosure, an updated appraisal is ordered and the recorded investment in the loan is adjusted to the net realizable value of the REO to be acquired. The adjustment is made to the specific reserve in the allowance for loan losses by a charge or a credit to the provision for loan losses. Real estate owned (“REO”) Real estate owned (“REO”) is property acquired in full or partial settlement of loan obligations generally through foreclosure and is recorded at acquisition at the property’s fair value less estimated costs to sell. The fair value estimates are derived from information available in the real estate markets including similar property, and often require the experience and judgment of third parties such as commercial real estate appraisers and brokers. The estimates figure materially in calculating the value of the property at acquisition, the level of charge to the allowance for loan losses and any subsequent valuation reserves. After acquisition, costs incurred relating to the development and improvement of property are capitalized to the extent they do not cause the recorded value to exceed the net realizable value, whereas costs relating to holding and disposition of the property are expensed as incurred. REO is analyzed periodically for changes in fair values and any subsequent write down is charged to REO, net on the statements of income. Any recovery in the fair value subsequent to such a write down is recorded, not to exceed the value recorded at acquisition. Recognition of gains on the sale of real estate is dependent upon the transaction meeting certain criteria related to the nature of the property and the terms of the sale including potential seller financing. Accrued liabilities Accrued liabilities at December 31, 2022 and 2021 were approximately $ 1.1 million, the significant components of which are accrued professional and consulting fees (approximately $ 993 thousand and $ 827 thousand, respectively) and accrued REO property taxes and mortgage interest expense (approximately $ 13 thousand and $ 164 thousand, respectively) and accrued interest on the line of credit (approximately $ 61 thousand and $ 47 thousand , respectively). Debt issuance costs Debt issuance costs are the fees and commissions incurred in the course of obtaining a line of credit for services from banks, law firms and other professionals and are amortized on a straight-line basis, which approximates the interest method, as interest expense over the term of the line of credit. Reclassification A reclassification has been made in the prior year statement of cash flows to reclassify the presentation of formation loan collected from changes in partners' capital to a separate line item within the financing section of the statement of cash flows. There was no change in total cash used in financing activities. Recently issued accounting pronouncements - Accounting and Financial Reporting for Expected Credit Losses Effective January 1, 2023, RMI VIII adopted Accounting Standards Codification 326, Financial Instruments – Credit Losses (“ASC 326”). The current expected credit loss (“CECL”) methodology required by ASC 326 utilizes a lifetime expected credit loss measurement objective for the recognition of credit losses at the time the financial asset is originated or acquired. The expected credit losses are adjusted each period for changes in expected lifetime credit losses for loans. The CECL methodology replaces the multiple existing impairment methods in current GAAP, which generally require that a loss be incurred before it is recognized. The CECL estimate is forward-looking, and management is required to use not only historical trends and current conditions, but also forecasts about future economic conditions to determine the expected credit loss over the remaining life of RMI VIII’s loans. Management has completed its evaluation and implementation of the adoption of the new standard and concluded that the change to CECL methodology from the incurred loss models presently in use did not result in a material impact to the reported results of operations or financial position upon adoption. |
General Partners and Other Rela
General Partners and Other Related Parties | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions [Abstract] | |
General Partners and Other Related Parties | NOTE 3 –GENERAL PARTNERS AND OTHER RELATED PARTIES The Partnership Agreement provides for fees as compensation to the manager and for reimbursement of qualifying expenses, as detailed below. Mortgage servicing fees The manager acting as servicing agent with respect to all loans is entitled to receive a servicing fee of up to 1.5 % annually of the unpaid principal balance of the loan portfolio. The mortgage servicing fees are accrued monthly on all loans. Remittance to RMC is made monthly unless the loan has been assigned a specific loss reserve, at which point remittance is deferred until the specific loss reserve is no longer required, or the property has been acquired by the partnership. Asset management fees The general partners are entitled to monthly fees for managing the business and affairs of RMI VIII, including management of the partnership’s loan portfolio and operations, of up to 1/32 of 1% of the “net asset value” of the partnership (3/8 of 1% annually). Costs from RMC The manager is entitled to request reimbursement for operations expense incurred on behalf of RMI VIII, including without limitation, RMC’s personnel and non-personnel costs incurred for qualifying business activities, including investor services, accounting, tax and data processing, postage and out-of-pocket general and administration expenses. Qualifying personnel/compensation costs and consulting fees are tracked by business activity, and then costs of qualifying activities are allocated to RMI VIII pro-rata based on the percentage of RMI VIII’s limited partners’ capital to the total capital of all related mortgage funds managed by RMC. Certain other non-personnel, qualifying costs such as postage and out-of-pocket general and administrative expenses can be tracked by RMC as specifically attributable to RMI VIII; other non-personnel, qualifying costs (e.g., RMC’s accounting and audit fees, legal fees and expenses, occupancy, and insurance premiums) are allocated pro-rata based on the percentage of RMI’s members’ capital to total capital of the related mortgage funds managed by RMC. Commissions and fees are paid by the borrowers to RMC - Brokerage commissions, loan originations For fees in connection with the review, selection, evaluation and negotiation of loans (including extensions), the general partners may collect loan brokerage commissions (i.e., points) limited to an amount not to exceed 4 % of the total partnership assets per year. The loan brokerage commissions are paid by the borrowers to RMC, and thus are not an expense of the partnership. Loan brokerage commissions paid by the borrowers to RMC approximated $ 968 thousand and $ 429 thousand for the years ended December 31, 2022 and 2021, respectively. - Other fees RMC receives fees for processing, notary, document preparation, credit investigation, reconveyance and other mortgage related services. The amounts received are customary for comparable services in the geographical area where the property securing the loan is located, payable solely by the borrower and not by the partnership. Formation loan Commissions for sales of limited partnership units paid to broker-dealers (“B/D sales commissions”) were paid by RMC and were not paid directly by the partnership out of offering proceeds. Instead, the partnership advanced to RMC amounts sufficient to pay the B/D sales commissions and premiums paid to partners in connection with unsolicited orders up to 7 % of offering proceeds. The receivable arising from the advances is unsecured and non-interest bearing and is referred to as the “formation loan.” Since its inception, the partnership’s advances totaled $ 22.6 million , of which $ 3 million remains outstanding at December 31, 2022. RMC is repaying the formation loan principally from loan brokerage commissions earned on loans, early withdrawal penalties on partner withdrawals and other fees paid by the partnership. If both or either one of the initial general partners is removed as a general partner by the vote of holders of a majority of the limited partnership units, and if such successor or additional general partner(s) begins using any other loan brokerage firm for the placement of loans, RMC will be immediately released from any further obligation under the formation loans (except for a proportionate share of the principal installment due at the end of that year). In addition, if both of the general partners are removed, no successor general partners are elected, the partnership is liquidated and RMC is no longer receiving any payments for services rendered, the debt on the formation loans shall be forgiven and RMC will be immediately released from any further obligations under the formation loans. As such, the formation loan is presented as contra equity. Formation loan transactions are presented in the following table ($ in thousands). 2022 2021 Balance, January 1 $ 3,361 $ 3,983 Payments received from RMC ( 659 ) ( 466 ) Early withdrawal penalties applied (1) — ( 156 ) Balance, December 31 $ 2,702 $ 3,361 (1) Beginning in 2022, RMC discontinued the specific allocation of early withdrawal penalties it received to the formation loan. The change has no net effect on the amounts paid by RMC to RMI VIII. RMC's scheduled payments total $ 650 thousand annually so that the formation loan is paid in full by December 31, 2026. Limited partners capital - withdrawals The table below sets forth withdrawals of limited partners' capital ($ in thousands). Withdrawals 2022 2021 Without penalty $ 11,192 $ 13,221 With penalty 1,250 1,562 Total $ 12,442 $ 14,783 Scheduled, at December 31, $ 13,870 $ 22,472 Scheduled withdrawals of limited partners’ capital as of December 31, 2022 are presented in the following table ($ in thousands). 2023 $ 7,019 2024 3,973 2025 1,830 2026 836 2027 196 Thereafter 16 Total $ 13,870 Scheduled withdrawals of limited partners’ capital of approximately $ 271 thousand are subject to early withdrawal penalties as the limited partners elected the accelerated payout option as permitted in the Partnership Agreement. Other related party transactions - Payable to/receivable from related parties From time to time, in the normal course of business operations, the partnership may have payables to and/or receivables from related parties. At December 31, 2022 , the payable to related parties of approximately $ 154 thousand consisted of accounts payable and cost reimbursements to the manager. At December 31, 2022 , the receivable from related parties of approximately $ 68 thousand consisted of accounts receivable from related mortgage funds. The related party transactions were settled by March 2023. At December 31, 2021, the partnership had a payable to related parties of approximately $ 47 thousand consisting of accounts payable and cost reimbursements to the manager. There were no receivables from related parties at December 31, 2021. The payable was paid to the manager in February 2022. - Loan transactions with related parties In the ordinary course of business, performing loans may be transferred by executed assignment, in-part or in-full, between the RMC-managed mortgage funds at par which approximates market value. In 2022 , RMI VIII transferred to a related mortgage fund four performing loans with aggregate principal of approximately $ 3.3 million at par value, which approximates fair value. The related mortgage fund paid cash for the loans and RMI VIII has no continuing involvement with the loans. No loans were transferred from related mortgage funds in 2022. In 2021 , RMI VIII transferred to a related mortgage fund seven performing loans with aggregate principal of approximately $ 5.7 million in-full at par value, which approximates fair value. RMI VIII was paid cash for the loans and has no continuing obligation or involvement with the loans. In 2021 , a related mortgage fund transferred to RMI VIII two performing loans with aggregate principal of approximately $ 1.4 million in-full at par value, which approximates fair value. RMI VIII paid cash for the loans and the related mortgage fund has no continuing obligation or involvement with the loans. - Promissory note received from/repaid to related parties On April 15, 2022, the partnership borrowed $ 1 million from a related party. This amount was utilized to fund a mortgage loan made by the partnership in the amount of $ 3.5 million, which mortgage loan was secured by a deed of trust encumbering a real property consisting of six tenancy-in-common units (each, a “TIC Unit”). At the time the mortgage loan was made, one of the TIC Units was in contract for sale with a scheduled closing date of April 18, 2022 and the mortgage loan borrower had agreed to utilize the proceeds of the sale of the TIC Unit to pay down the mortgage loan in exchange for a partial release of the deed of trust securing the mortgage loan (“Release Proceeds”). The loan from the related party accrued interest at the same rate of 7.75% as the mortgage loan and was secured by a pledge of all payments received by the partnership under the mortgage loan, including the Release Proceeds. The note matured on April 30, 2022. The Release Proceeds were received by the partnership on the April 18, 2022 closing date and were thereafter utilized by the partnership to repay the loan, in full. |
Loans
Loans | 12 Months Ended |
Dec. 31, 2022 | |
Receivables [Abstract] | |
Loans | NOTE 4 – LOANS Loans generally are funded at a fixed interest rate with a loan term of up to five years . Loans acquired are generally done so within the first six months of origination and purchased at the current par value, which approximates fair value. See Note 3 (General Partners and Other Related Parties) for a description of loans transferred by executed assignments between the related mortgage funds. As of December 31, 2022, 20 of the partnership’s 21 loans (representing 96 % of the aggregate principal of the partnership’s loan portfolio) have a term of five years or less. The remaining loan has a term longer than five years. Substantially all loans are written without a prepayment penalty provision. As of December 31, 2022, 13 of the loans outstanding (representing 69 % of the aggregate principal balance of the partnership’s loan portfolio) provide for monthly payments of interest only, with the principal due in full at maturity. The remaining loans require monthly payments of principal and interest, typically calculated on a 30 -year amortization, with the remaining principal balance due at maturity. Secured loans unpaid principal balance (principal) Secured loan transactions are summarized in the following table ($ in thousands). 2022 2021 Principal, beginning of period $ 55,099 $ 74,080 Loans funded 48,419 25,248 Principal collected (1) ( 30,412 ) ( 39,404 ) Loan transferred from related mortgage fund — 1,371 Loans transferred to related mortgage fund ( 3,284 ) ( 5,711 ) Loans sold to non-affiliate ( 9,734 ) ( 485 ) Principal, end of period $ 60,088 $ 55,099 (1) Principal collected in 2022 includes principal collected and held in trust of $ 0 at December 31, 2022 offset by principal collected and held in trust of approximately $ 465 thousand at December 31, 2021 which was disbursed to the partnership in January 2022. Principal collected in 2021 includes principal collected and held in trust of $ 465 thousand at December 31, 2021 offset by principal collected and held in trust of approximately $ 1 thousand at December 31, 2020 which was disbursed to the partnership in January 2021 . During 2022 and 2021 , the partnership renewed 9 and 8 loans with aggregate principal of approximately $ 32 million and $ 36.6 million, respectively, which are not included in the activity shown in the above table. The loans were current and deemed well collateralized (i.e., the LTV for the collateral was within lending guidelines) at the time they were extended. The loans have an average extension period of approximately 9 months and 11 months during 2022 and 2021. Additionally, interest rates charged to borrowers may be adjusted in conjunction with the loan extensions to reflect current market conditions. The partnership funds loans with the intent to hold the loans until maturity, although from time to time the partnership may sell certain loans when the manager determines it to be in the best interest of the partnership. In 2022 , four loans with principal of approximately $ 9.7 million were sold to unaffiliated third-parties. After commissions and transaction costs to third parties the partnership recognized a gain of approximately $ 122 thousand. In 2021 , one loan with principal of approximately $ 485 thousand, was sold to an unaffiliated third-party, for an amount that approximated the loan balance at the time of sale. Pursuant to California regulatory requirements borrower payments are deposited into a trust account established by RMC with an independent bank and are presented on the balance sheet as “Loan payments in trust”. Funds are disbursed to the partnership as collected which can range from same day for wire transfers and up to two weeks after deposit for checks. There were no loan payments in trust at December 31, 2022. Loan payments in trust at December 31, 2021 were distributed to the partnership’s account by January 14, 2022. Loan characteristics Secured loans had the characteristics presented in the following table ($ in thousands). December 31, December 31, 2022 2021 Number of secured loans 21 31 Secured loans – principal $ 60,088 $ 55,099 Secured loans – lowest interest rate (fixed) 7.3 % 7.3 % Secured loans – highest interest rate (fixed) 10.8 % 10.8 % Average secured loan – principal $ 2,861 $ 1,777 Average principal as percent of total principal 4.8 % 3.2 % Average principal as percent of partners’ capital, net of formation loan 5.3 % 2.7 % Average principal as percent of total assets 4.3 % 2.6 % Largest secured loan – principal $ 9,000 $ 7,994 Largest principal as percent of total principal 15.0 % 14.5 % Largest principal as percent of partners’ capital, net of formation loan 16.6 % 12.2 % Largest principal as percent of total assets 13.4 % 11.7 % Smallest secured loan – principal $ 437 $ 56 Smallest principal as percent of total principal 0.7 % 0.1 % Smallest principal as percent of partners’ capital, net of formation loan 0.8 % 0.1 % Smallest principal as percent of total assets 0.7 % 0.1 % Number of California counties where security is located 10 12 Largest percentage of principal in one California county 30.7 % 32.1 % As of December 31, 2022, there are four loans with principal balances in excess of 10 % of the total outstanding principal balance. T he partnership’s largest loan, with an unpaid principal balance of $ 9 million is secured by an office building in the City of Orange in Orange County, bears an interest rate of 7.99 %, and matures on September 1, 2025 . The second loan, with principal of approximately $ 8.8 million is secured by a commercial building in the City of Santa Clara in Santa Clara County, bears an interest rate of 8.375 % and matures on July 1, 2027 . The third loan, with principal of approximately $ 8 million is secured by a commercial building in the City and County of San Francisco, bears an interest rate of 8.375 % and matures on April 1, 2023 . The fourth loan, with principal of approximately $ 6.3 million is secured by a multifamily building in the City and County of San Francisco, bears an interest rate of 7.75 % and matures on April 1, 2023 . All four loans were performing and were in first lien position. As of December 31, 2022 , the partnership had no commitments to lend outstanding and had no construction or rehabilitation loans outstanding. Distribution of secured loans-principal by California counties The distribution of secured loans by counties is presented in the following table ($ in thousands). December 31, 2022 December 31, 2021 Principal Percent Principal Percent San Francisco Bay Area (2) San Francisco $ 18,425 30.7 % $ 17,694 32.1 % San Mateo 2,519 4.2 7,696 14.0 Santa Clara 12,266 20.4 4,600 8.4 Sonoma — 0.0 576 1.0 Solano 3,550 5.9 — 0.0 Marin 1,099 1.8 1,653 3.0 Alameda 1,687 2.8 6,239 11.3 39,546 65.8 38,458 69.8 Other Northern California Stanislaus 1,301 2.2 — 0.0 Mariposa — 0.0 56 0.1 1,301 2.2 56 0.1 Northern California Total 40,847 68.0 38,514 69.9 Los Angeles & Coastal Santa Barbara 2,044 3.4 2,062 3.7 Los Angeles 5,597 9.3 10,783 19.6 Orange 11,600 19.3 2,192 4.0 San Diego — 0.0 1,088 2.0 19,241 32.0 16,125 29.3 Other Southern California Riverside — 0.0 460 0.8 — 0.0 460 0.8 Southern California Total 19,241 32.0 16,585 30.1 Total principal, secured loans $ 60,088 100.0 % $ 55,099 100.0 % (2) Includes Silicon Valley Property type Secured loans summarized by property type are presented in the following table ($ in thousands). December 31, 2022 December 31, 2021 Loans Principal Percent Loans Principal Percent Single family (3) 4 $ 5,874 10 % 16 $ 14,597 26 % Multi-family 3 8,326 14 2 7,550 14 Commercial 12 44,587 74 13 32,952 60 Land 2 1,301 2 — — 0 Total principal, secured loans 21 $ 60,088 100 % 31 $ 55,099 100 % (3) Single family property type as of December 31, 2022 consists of 4 loans with aggregate principal of approximately $ 5.9 million that are non-owner occupied. At December 31, 2021, single family property type consisted of 4 loans with aggregate principal of approximately $ 2.3 million that were owner occupied and 12 loans with aggregate principal of approximately $ 12.3 million that were non-owner occupied. Single family includes 1-4 unit residential buildings, condominium units, townhouses and condominium complexes. Lien position At funding, secured loans had the lien positions in the following table ($ in thousands). December 31, 2022 December 31, 2021 Loans Principal Percent Loans Principal Percent First trust deeds 18 $ 55,803 93 % 25 $ 45,992 83 % Second trust deeds 3 4,285 7 6 9,107 17 Total principal, secured loans 21 60,088 100 % 31 55,099 100 % Liens due other lenders at loan closing 8,956 14,988 Total debt $ 69,044 $ 70,087 Appraised property value at loan closing $ 138,924 $ 117,570 Percent of total debt to appraised values (LTV) (4) 55.4 % 62.3 % (4) Based on appraised values and liens due other lenders at loan closing. The weighted-average loan-to-value (LTV) computation above does not take into account subsequent increases or decreases in property values following the loan closing, nor does it include decreases or increases of the amount of senior liens to other lenders. Scheduled maturities/Secured loans-principal Secured loans scheduled to mature as of December 31, 2022 are presented in the following table ($ in thousands). First Trust Deeds Second Trust Deeds Loans Principal Percent Loans Principal Loans Principal 2023 13 $ 31,575 52 % 11 $ 28,540 2 $ 3,035 2024 2 1,247 2 2 1,247 — — 2025 1 9,000 15 1 9,000 — — 2026 1 1,250 2 — — 1 1,250 2027 2 12,386 21 2 12,386 — — Total scheduled maturities 19 55,458 92 16 51,173 3 4,285 Matured at December 31, 2022 (5) 2 4,630 8 2 4,630 — — Total principal, secured loans 21 $ 60,088 100 % 18 $ 55,803 3 4,285 (5) See Delinquency/Secured loans with payments in arrears below for more information on matured loans. Scheduled maturities are presented based on the most recent in-effect agreement with the borrower, including forbearance agreements. As a result, matured loans at December 31, 2022, for the scheduled maturities table may differ from the same captions in the tables of delinquencies and payments in arrears that are based on the loan terms and do not consider forbearance agreements. For matured loans, the partnership may continue to accept payments while pursuing collection of principal or while negotiating an extension of the loan’s maturity date. It is the partnership’s experience that the timing of future cash receipts from secured loans will differ from scheduled maturities. Loans may be repaid or renewed before, at or after the contractual maturity date. Delinquency/Secured loans Secured loans by payment-delinquency status are presented in the following table ($ in thousands). December 31, 2022 December 31, 2021 Loans Principal Loans Principal Current 18 $ 54,359 25 $ 48,274 Past Due 30-89 days — — 2 5,782 90-179 days 2 2,009 1 56 180 or more days 1 3,720 3 987 Total past due 3 5,729 6 6,825 Total principal, secured loans 21 $ 60,088 31 $ 55,099 The table above presents the unpaid principal balance by delinquency category for all secured loans based on the payment status, including loans that are interest only with no principal due. Secured loans at December 31, 2022 and December 31, 2021, had principal payments in arrears totaling approximately $ 4.6 million ( 3 loans) and $ 1 million ( 6 loans), respectively, and interest payments in arrears totaling approximately $ 482 thousand and $ 71 thousand, respectively. Payments in arrears for secured loans (i.e., monthly interest and principal payments past due 30 or more days) at December 31, 2022, are presented in the following tables ($ in thousands). Loans Principal Interest (6) At December 31, 2022 Past Monthly Past Monthly Past Monthly Total Past due 30-89 days (1-3 payments) — — $ — $ — $ — $ — $ — 90-179 days (4-6 payments) 1 1 910 1 24 25 960 180 or more days (more than 6 1 — 3,720 — 433 — 4,153 Total past due 2 1 $ 4,630 $ 1 $ 457 $ 25 $ 5,113 (6) Interest includes foregone interest of approximately $ 200 thousand on non-accrual loans past maturity. Interest for December 2022 is due January 1 , 2023 and is not included in the payments in arrears at December 31, 2022 . At December 31, 2022 and December 31, 2021, there were no forbearance agreements in effect. Secured loans in non-accrual status are summarized in the following table ($ in thousands). December 31, 2022 December 31, 2021 Number of loans 1 4 Principal $ 3,720 $ 1,044 Advances 60 116 Accrued interest (7) 233 13 Total recorded investment $ 4,013 $ 1,173 Foregone interest $ 233 $ 1 (7) Accrued interest in the table above is the amount of interest accrued prior to the loan being placed on non-accrual status, net of any payments received while in non-accrual status . Interest income of $ 167 thousand and $ 107 thousand was recognized for loans in non-accrual status in 2022 and 2021, respectively. The amortized cost basis of loans in non-accrual status with no specific allowance at December 31, 2022 and December 31, 2021 is equivalent to the entire balance of loans in non-accrual status since there is no specific allowance recorded for any loan. Non-performing loans are placed on non-accrual status the first of the following month after it is 180 days delinquent or earlier if management determines that the primary source of repayment will come from the foreclosure and subsequent sale of the collateral securing the loan (which usually occurs when a notice of sale is filed) or when the loan is no longer considered well-secured. When a loan is placed on non-accrual status, the accrual of interest is discontinued for accounting purposes only (i.e., foregone interest in the table above), however, previously recorded interest is not reversed. Once the payments are made current, interest income is recognized. At December 31, 2022, 2 loans with aggregate principal of approximately $ 2 million were 90 days or more past due and were not in non-accrual status. At December 31, 2021 , there were no loans 90 or more days past due and not in non-accrual status. Provision/allowance for loan losses and impaired loans Generally, the partnership has not recorded an allowance for loan losses as all loans have protective equity such that collection is deemed probable for all recorded amounts due on the loan. From time to time, the manager may deem it in the best interest of the partnership to agree to concessions to borrowers to facilitate a sale of collateral or refinance transactions primarily for secured loans in second lien position. Activity in the allowance for loan losses for 2022 and 2021 are presented in the following table ($ in thousands). 2022 2021 Balance, January 1 $ 55 $ 50 Provision for loan loss — 5 Recovery for loan losses — — Balance, December 31 $ 55 $ 55 Loans designated impaired and any associated allowance for loan losses is presented in the following table ($ in thousands). December 31, 2022 December 31, 2021 Number of loans 3 4 Principal $ 5,729 $ 1,043 Recorded investment (8) 6,078 1,173 Impaired loans without allowance 6,078 1,173 Impaired loans with allowance — — Allowance for loan losses, impaired loans — — Weighted average LTV at origination 42.3 % 45.4 % (8) Recorded investment is the sum of principal, advances, and interest accrued for financial reporting purposes. Loans designated impaired had an average recorded investment and interest income recognized and received in cash as presented in the following table ($ in thousands). December 31, 2022 December 31, 2021 Average recorded investment $ 3,625 $ 8,352 Interest income recognized 296 107 Interest income received in cash 79 98 |
Real Estate Owned (REO) and Mor
Real Estate Owned (REO) and Mortgages Payable | 12 Months Ended |
Dec. 31, 2022 | |
Real Estate [Abstract] | |
Real Estate Owned (REO) and Mortgages Payable | NOTE 5 – REAL ESTATE OWNED (REO) AND MORTGAGES PAYABLE REO transactions and valuation adjustments for 2022 and 2021 are summarized in the following tables ($ in thousands). 2022 REO Valuation Allowance REO, net Balance, beginning of period $ 10,458 $ ( 2,200 ) $ 8,258 Valuation allowance adjustment — 261 261 Dispositions ( 4,547 ) 1,939 ( 2,608 ) Balance, December 31, 2022 $ 5,911 $ — $ 5,911 2021 REO Valuation Allowance REO, net Balance, beginning of period $ 12,044 $ ( 3,239 ) $ 8,805 Valuation allowance adjustment — ( 294 ) ( 294 ) Dispositions ( 1,586 ) 1,333 ( 253 ) Balance, December 31, 2021 $ 10,458 $ ( 2,200 ) $ 8,258 REO at December 31, 2022 was comprised of three properties with a carrying value of approximately $ 5.9 million. • In Los Angeles County (Hollywood Hills) two single-family residences on separate, adjoining parcels. • In San Francisco County, a real estate interest comprised of a condominium unit composed of storage lockers and signage rights for the exterior façade of the building. The following transactions occurred during the year ended December 31, 2022. • The partnership sold - in Stanislaus County, 14 acres of undeveloped land in 2 separate transactions – approximately 9 acres in July 2022, and approximately 5 acres in September 2022 for approximately $ 2.6 million. The net combined sales proceeds approximated the adjusted carrying value after an adjustment to reduce the valuation allowance by approximately $ 261 thousand and after fees paid to RMC associated with management of the properties and arranging the sales of approximately $ 73 thousand, which is included in the Consolidated Statements of Income as a mortgage servicing fee. For the first sale, RMI VIII provided a $ 664 thousand first mortgage at market terms and an LTV of 40 % and for the second sale, RMI VIII provided a $ 637 thousand first mortgage at market terms and an LTV of 65 %. Management believes these terms are reasonable and customary and the borrower has the intent and ability to pay the contracted price. • The partnership sold - in San Francisco County, 1 residential unit in a condominium complex for approximately $ 240 thousand , resulting in a gain of approximately $ 108 thousand. The following transactions occurred during the year ended December 31, 2021. • The valuation allowance on REO properties was increased by $ 294 thousand based on sales data on transactions in the second half of 2021. • The partnership sold - in Fresno County, a partially completed home subdivision. The net realized amount approximated the adjusted carrying value taking into account previously recorded valuation allowances. The two Hollywood Hills single-family residences were acquired in June 2020 by foreclosure sales. The borrower contested the foreclosure sales by filing a California state court action. That action was dismissed by the trial Court and the dismissal was appealed by the borrower. The Appellate Court recently affirmed the dismissal. At December 31, 2022 , accrued liabilities include accrued interest of approximately $ 13 thousand and prepaid insurance of approximately $ 4 thousand. Accounts payable at December 31, 2022 includes $ 230 thousand for negative escrow and unpaid late charges. At December 31, 2021 , accrued liabilities include accrued interest of approximately $ 94 thousand , and property taxes of approximately $ 69 thousand. Accounts payable at December 31, 2021 include $ 184 thousand for negative escrow and unpaid late charges. There is a mortgage note payable secured by a first trust deed on one of the Hollywood Hills properties that matures November 1, 2044, with monthly payments of approximately $ 8 thousand, and interest at 4.125 % until October 31, 2024 after which interest is at LIBOR plus 2.25 %. As of December 31, 2022 , payments on mortgage note payable were paid to September 30, 2022. Principal was approximately $ 1.3 million at December 31, 2022 ($ 1.5 million at December 31, 2021). The notice of default previously recorded in May 2022 due to defaults by the original borrower was rescinded in September 2022. In August 2021, the partnership paid in-full the outstanding principal balance of approximately $ 996 thousand due on one of the mortgages, as well as the outstanding mortgage interest, late fees and other fees of approximately $ 96 thousand. REO, net REO, net in operations expense on the consolidated income statements is comprised of the following for 2022 and 2021 ($ in thousands). 2022 2021 Holding costs, net of other income $ ( 256 ) $ ( 299 ) Gain on sales 108 79 Valuation adjustments 261 ( 294 ) REO, net $ 113 $ ( 514 ) Holding costs, net of other income includes month-to-month rents received of approximately $ 33 thousand and $ 77 thousand for the years ended December 31, 2022 and 2021, respectively, for the homes in Fresno County, which were sold in July 2021, and the unit-storage lockers and signage in San Francisco County. |
Fair Value
Fair Value | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value | NOTE 6 – FAIR VALUE Secured loans The following methods and assumptions are used when estimating fair value. Secured loans, performing and non-performing not designated as impaired (Level 3) - Each loan is reviewed quarterly for its delinquency, LTV adjusted for the most recent valuation of the underlying collateral, remaining term to maturity, borrower’s payment history and other factors. Due to the nature of the partnership’s loans and borrowers the fair value of loan balances secured by deeds of trust is deemed to approximate the recorded amount (per the consolidated financial statements) as the partnership's loans: • are of shorter terms at origination than commercial real estate loans by institutional lenders and conventional single-family home mortgage lenders; • are written without a prepayment penalty causing uncertainty/a lack of predictability as to the expected duration of the loan; and • have limited marketability and are not yet sellable into an established secondary market. Secured loans, designated impaired (Level 3) - The fair value of secured loans designated impaired is the lesser of the fair value of the collateral or the enforceable amount of the note. Secured loans designated impaired are collateral dependent because it is expected that the primary source of repayment will not be from the borrower but rather from the collateral. The fair value of the collateral is determined on a nonrecurring basis by exercise of judgment based on management’s experience informed by appraisals (by licensed appraisers), brokers’ opinion of values and publicly available information on in-market transactions (Level 3 inputs). When the fair value of the collateral exceeds the enforceable amount of the note, the borrower is likely to redeem the note. Accordingly, third party market participants would generally pay the fair value of the collateral, but no more than the enforceable amount of the note. The following methods and assumptions are used to determine the fair value of the collateral securing a loan. Single family – Management’s preferred method for determining the fair market value of its single-family residential assets is the sale comparison method. Management primarily obtains sales comparables (comps) via its subscription to the RealQuest service, but also uses free online services such as Zillow.com and other available resources to supplement this data. Sale comps are reviewed and adjusted for similarity to the subject property, examining features such as proximity to subject, number of bedrooms and bathrooms, square footage, sale date, condition and year built. If applicable sale comps are not available or deemed unreliable, management will seek additional information in the form of brokers’ opinions of value or appraisals. Multi-family residential – Management’s preferred method for determining the aggregate retail value of its multifamily units is the sale comparison method. Sale comps are typically provided in appraisals, or by realtors who specialize in multi-family residential properties. Sale comps are reviewed for similarity to the subject property, examining features such as proximity to subject, rental income, number of units, composition of units by the number of bedrooms and bathrooms, square footage, condition, amenities and year built. Management’s secondary method for valuing its multifamily assets as income-producing rental operations is the direct capitalization method. In order to determine market cap rates for properties of the same class and location as the subject, management refers to published data from reliable third-party sources such as the CBRE Cap Rate Survey. Management applies the appropriate cap rate to the subject’s most recent available annual net operating income to determine the property’s value as an income-producing project. When adequate sale comps are not available or reliable net operating income information is not available or the project is under development or is under-performing to market, management will seek additional information and analysis to determine the cost to improve and the intrinsic fair value and/or management will seek additional information in the form of brokers’ opinion of value or appraisals. Commercial buildings – Management’s preferred method for determining the fair value of its commercial buildings is the sale comparison method. Sale comps are typically provided in appraisals, or by realtors who specialize in commercial properties. Sale comps are reviewed for similarity to the subject property, examining features such as proximity to subject, rental income, number of units, composition of units, common areas, and year built. Management’s secondary method for valuing its commercial buildings is the direct capitalization method. In order to determine market cap rates for properties of the same class and location as the subject, management refers to reputable third-party sources such as the CBRE Cap Rate Survey. Management then applies the appropriate cap rate to the subject’s most recent available annual net operating income to determine the property’s value as an income-producing commercial rental project. When adequate sale comps are not available or reliable net operating income information is not available or the project is under development or is under-performing to market, management will seek additional information and analysis to determine the cost to improve and the intrinsic fair value and/or management will seek additional information in the form of brokers’ opinion of value or appraisals. Commercial land – Commercial land has many variations and uses, thus requiring management to employ a variety of methods depending upon the unique characteristics of the subject land, including a determination of its highest and best use. Management may rely on information in the form of a sale comparison analysis (where adequate sale comps are available), brokers’ opinion of value, or appraisal. |
Line of Credit
Line of Credit | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Line of Credit | NOTE 7 – LINE OF CREDIT Activity involving the line of credit during the years ended December 31, 2022 and 2021 is presented in the following table ($ in thousands). 2022 2021 Balance, January 1 $ — $ 2,453 Draws 11,000 16,847 Repayments ( 1,000 ) ( 19,300 ) Balance, December 31, $ 10,000 $ — Line of credit - average daily balance $ 8,454 $ 6,417 In March 2020, RMI VIII entered into a revolving line of credit and term loan agreement with Western Alliance Bank (“bank”) which is governed by the terms of the Business Loan Agreement (Revolving Line of Credit and Term Loan Agreement) between bank and the partnership (“original credit agreement”), which was amended and modified by the First Loan Modification Agreement made effective March 4, 2022 (the “modification agreement” and together with the original credit agreement, the “credit agreement of 2022”). Under the terms of the credit agreement of 2022, RMI VIII can borrow up to a maximum principal of $ 10 million subject to a borrowing base calculation set forth in the credit agreement and the amounts advanced under the credit agreement are secured by a first priority security interest in the notes and deeds of trust of the pledged loans included in the borrowing base. The maturity date is March 13, 2024 when all amounts outstanding are then due. RMI VIII has the option at the maturity date to convert - for a fee of one-quarter of one percent ( 0.25 %) – the then outstanding principal balance to a two-year term loan maturing in March 2026 . Prior to the modification agreement, interest on outstanding principal was payable monthly and accrued at the per annum rate of the greater of (i) five percent ( 5 %) or (ii) the sum of the one-month LIBOR rate plus three and one-quarter percent ( 3.25 %). The modification agreement replaced LIBOR as the reference rate under the credit agreement with the 30-day American Interbank Offered Rate Term -30 Index published for loans in United States Dollars by the American Financial Exchange ( “Ameribor” ). Following the modification agreement, interest on the outstanding principal under the credit line is payable monthly and accrues at the annual rate that is the greater of: (i) the Ameribor Rate plus three and one-quarter percent (3.25%); and (ii) five percent (5.0%). The fair value of the balance on the line of credit is deemed to approximate the recorded amount because the reference rate plus 3.25% and the other terms and conditions, including the two-year term, of the Revolving Line of Credit and Term Loan Agreement are reflective of market rate terms (Level 2 inputs). If the partnership does not maintain the required compensating balance with a minimum daily average of $ 1.0 million for the calendar quarter, the interest rate automatically increases by one-quarter of one percent ( 0.25 %) above that rate which would otherwise be applicable for the next calendar quarter retroactive to the beginning of the calendar quarter in which the compensating balance is not maintained. At December 31, 2022, the interest rate was seven and fourteen one-hundredths percent ( 7.14 %). For each calendar quarter during which the aggregate average daily outstanding principal is less than fifty percent ( 50 %) of the maximum principal of $10 million, there is a quarterly unused line fee equal to one-half of one percent ( 0.50 %) per annum of the average daily difference between the average principal outstanding and fifty percent (50%) of the maximum principal of $ 10 million. Advances on the line of credit are to be used exclusively to fund secured loans. The credit agreement provides for customary financial and borrowing base reporting by RMI VIII to the lending bank and specifies that the partnership shall maintain (i) minimum tangible net worth of $ 50 million, net of amounts due from related companies; (ii) debt service coverage ratio at all times of not less than 2.00 to 1.00 ; and (iii) loan payment delinquency of less than ten percent ( 10.0 %) at calendar quarter-end, calculated as the principal of loans with payments over 61-days past due as determined by the lending bank’s guidance, less loan loss allowances, divided by total principal of the partnership’s loans. The loan agreement provides that in the event the loan payment delinquency rate exceeds 10.0% as of the end of any quarter, the bank will cease to make any further advances but agrees not to accelerate repayment of the loan. At December 31, 2022 and 2021 , aggregate principal of pledged loans was approximately $ 23.2 million and $ 21.5 million, respectively, with a maximum allowed advance thereon of approximately $ 10 million, subject to the borrowing base calculation. The debt issuance costs from the original credit agreement were fully amortized in March 2022. Debt issuance costs of approximately $ 57 thousand from the modification agreement are being amortized over its two-year term. Amortized debt issuance costs included in interest expense approximated $ 34 thousand and $ 54 thousand for 2022 and 2021 , respectively. |
Commitments and Contingencies,
Commitments and Contingencies, Other than Loan and REO Commitments | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies Other than Loan and REO Commitments | NOTE 8 – COMMITMENTS AND CONTINGENCIES OTHER THAN LOAN AND REO COMMITMENTS Commitments Note 3 (General Partners and Other Related Parties) presents detailed discussion of the partnership’s contractual obligations to RMC and detail of scheduled withdrawals of limited partners’ capital at December 31, 2022. Legal proceedings As of December 31, 2022, the partnership is not involved in any legal proceedings other than those that would be considered part of the normal course of business and no legal proceedings were terminated during the fourth quarter of 2022. In the normal course of its business, the partnership may become involved in legal proceedings (such as assignment of rents, bankruptcy proceedings, appointment of receivers, unlawful detainers, judicial foreclosure, etc.) to collect the debt owed under the promissory notes, to enforce the provisions of the deeds of trust, to protect its interest in the real property subject to the deeds of trust and to resolve disputes with borrowers, lenders, lien holders and mechanics. None of these actions, in and of themselves, typically would be of any material financial impact to the net income or balance sheet of the partnership. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 9 – SUBSEQUENT EVENTS The partnership evaluated subsequent events that have occurred after December 31, 2022 and determined that there were no events or transactions that require recognition or disclosure in the consolidated financial statements. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of presentation The financial statements are prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The partnership’s consolidated financial statements include the accounts of the partnership and its wholly-owned subsidiaries (consisting of single-member limited liability companies owning a single real property asset). All significant intercompany transactions and balances have been eliminated in consolidation. |
Management Estimates | Management estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions about the reported amounts of assets and liabilities, and disclosures of contingent assets and liabilities, at the dates of the financial statements and the reported amounts of revenues and expenses during the reported periods. Such estimates involve significant level of uncertainty and have had or are reasonably likely to have a material impact on the partnership’s financial condition or results of operations. Such estimates relate principally to the determination of the allowance for loan losses, including the valuation of impaired loans (which itself requires determining the fair value of the collateral), and the valuation of real estate owned, at acquisition and subsequently. Actual results could differ materially from these estimates. |
Fair Value Estimates | Fair value estimates GAAP defines fair value as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. An orderly transaction is a transaction that assumes exposure to the market for a period prior to the measurement date to allow for marketing activities that are usual and customary for transactions involving such assets and liabilities; it is not a forced transaction. Market participants are buyers and sellers in the principal market that are (i) independent, (ii) knowledgeable, (iii) able to transact and (iv) willing to transact. Fair values of assets and liabilities are determined based on the fair value hierarchy established in GAAP. The hierarchy is comprised of three levels of inputs to be used. • Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the partnership has the ability to access at the measurement date. An active market is a market in which transactions occur with sufficient frequency and volume to provide pricing information on an ongoing basis. • Level 2 inputs are inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly in active markets and quoted prices for identical assets or liabilities that are not active, and inputs other than quoted prices that are observable or inputs derived from or corroborated by market data. • Level 3 inputs are unobservable inputs for the asset or liability. Unobservable inputs reflect the partnership’s own assumptions about the assumptions market participants would use in pricing the asset or liability (including assumptions about risk). Unobservable inputs are developed based on the best information available in the circumstances and may include the partnership’s own data. The fair value of real property is determined by exercise of judgment based on management’s experience informed by appraisals (by licensed appraisers), brokers’ opinion of values, and publicly available information on in-market transactions. Appraisals of commercial real property generally present three approaches to estimating value: 1) market comparables or sales approach; 2) cost to replace; and 3) capitalized cash flows or income approach. These approaches may or may not result in a common, single value. The market-comparables approach may yield several different values depending on certain basic assumptions, including the consideration of adjustments made for any attributes specific to the real estate. Management has the requisite familiarity with the markets it lends in generally and of the properties lent on specifically to analyze sales-comparables and assess their suitability/applicability. Management is acquainted with market participants – investors, developers, brokers, lenders – that are useful, relevant secondary sources of data and information regarding valuation and valuation variability. These secondary sources may have familiarity with and perspectives on pending transactions, successful strategies to optimize value, and the history and details of specific properties – on and off the market – that enhance the process and analysis that is particularly and principally germane to establishing value in distressed markets and/or property types. |
Cash in Banks | Cash in banks Certain of the partnership’s cash balances in banks exceed federally insured limits of $ 250 thousand. The bank or banks in which funds are deposited are reviewed periodically for their general creditworthiness/investment grade credit rating. See Note 7 (Line of Credit) for compensating balance arrangements. |
Loans and Interest Income | Loans and interest income Performing loans are carried at amortized cost, which is generally equal to the unpaid principal balance (principal). Management has discretion to pay amounts (advances) to third parties on behalf of borrowers to protect the partnership’s interest in the loan. Advances include, but are not limited to, the payment of interest and principal on a senior lien to prevent foreclosure by the senior lien holder, property taxes, insurance premiums, and attorney fees. Advances generally are stated at the amounts paid out on the borrower’s behalf and any accrued interest on amounts paid out, until repaid by the borrower. For performing loans, interest is accrued daily on the principal plus advances, if any. Non-performing loans (i.e., loans with a payment in arrears) less than 180 days delinquent continue to recognize interest income as long as the loan is in the process of collection and is considered to be well-secured. Non-performing loans are placed on non-accrual status if 180 days delinquent or earlier if management determines that the primary source of repayment will come from the foreclosure and subsequent sale of the collateral securing the loan (which usually occurs when a notice of sale is filed) or when the loan is no longer considered well-secured. When a loan is placed on non-accrual status, the accrual of interest is discontinued; however, previously recorded interest is not reversed. A loan may return to accrual status when all delinquent interest and principal payments become current in accordance with the terms of the loan agreement. Late fees are recognized in the period received. The partnership may fund a specific loan origination net of an interest reserve ( one to two years ) to insure timely interest payments at the inception of the loan. Any interest reserve is amortized over the period that the amount is prepaid. In the event of an early loan payoff, any unapplied interest reserves would be first applied to any accrued but unpaid interest and then as a reduction of principal. In the normal course of the partnership’s operations, performing loans that are maturing or have matured may be renewed at then current market rates of interest and terms for new loans. From time to time, the manager negotiates and enters into loan modifications with borrowers whose loans are delinquent (non-performing). If a borrower is experiencing financial difficulties and a loan modification were to result in an economic concession to the borrower (i.e., a significant delay or reduction in cash flows compared to the original note), the modification is deemed a troubled debt restructuring (“TDR”). The partnership funds loans with the intent to hold the loans until maturity. From time to time the partnership may sell certain loans. Loans are classified as held-for-sale once a decision has been made to sell loans and the loans held-for-sale have been identified. Loans classified as held for sale are carried at the lower of cost or fair value. Pursuant to California regulatory requirements borrower payments are deposited into a trust account established by RMC with an independent bank and are presented on the balance sheet as “Loan payments in trust”. Funds are disbursed to the partnership as collected which can range from same day for wire transfers and up to two weeks after deposit for checks. |
Allowance for Loan Losses | Allowance for loan losses Loans and the related accrued interest and advances (i.e., the loan balance) are analyzed on a periodic basis for ultimate recoverability. Collateral fair values are reviewed quarterly and the protective equity for each loan is computed. As used herein, “protective equity” is the dollar amount by which the net realizable value (i.e., fair value less the cost to sell) of the collateral, net of any senior liens, exceeds the loan balance, where “loan balance” is the sum of the unpaid principal, advances and the recorded interest thereon. If based upon current information and events, it is probable the partnership will be unable to collect all amounts due according to the contractual terms of the loan agreement, then a loan may be designated as impaired. An insignificant delay or insignificant shortfall in the amount of payments does not constitute non-performance with the contractual terms of the original loan agreement if the manager expects to collect the amounts due including interest accrued at the contractual interest rate for the period of delay. In determining the probability that the borrower will not substantially perform according to the terms of the original loan agreement, the manager considers the following: • payment status – if payments are in arrears 90+ days (typically 3 payments past due) loans are designated impaired unless resolution of the delinquency is forthcoming without significant delay; • bankruptcy – if the borrower files bankruptcy, the loan is designated impaired; • notice of sale – if the partnership files a notice of sale, the loan is designated impaired. Payments on loans designated impaired are applied to late fees, then to the accrued interest, then to advances, and lastly to principal. For loans that are deemed to be collateral dependent for repayment, a provision for loan losses is recorded to adjust the allowance for loan losses (principal and/or recorded interest) in an amount such that the net carrying amount (unpaid principal less the specific allowance) is reduced to the lower of the loan balance or the estimated fair value of the related collateral, net of any costs to sell and net of any senior debt and claims. The partnership charges off uncollectible loans and related receivables directly to the allowance account once it is determined the full amount is not collectible. Any amounts collected after a charge off is deemed a recovery of loan losses. If the loan goes to foreclosure, an updated appraisal is ordered and the recorded investment in the loan is adjusted to the net realizable value of the REO to be acquired. The adjustment is made to the specific reserve in the allowance for loan losses by a charge or a credit to the provision for loan losses. |
Real Estate Owned (REO) | Real estate owned (“REO”) Real estate owned (“REO”) is property acquired in full or partial settlement of loan obligations generally through foreclosure and is recorded at acquisition at the property’s fair value less estimated costs to sell. The fair value estimates are derived from information available in the real estate markets including similar property, and often require the experience and judgment of third parties such as commercial real estate appraisers and brokers. The estimates figure materially in calculating the value of the property at acquisition, the level of charge to the allowance for loan losses and any subsequent valuation reserves. After acquisition, costs incurred relating to the development and improvement of property are capitalized to the extent they do not cause the recorded value to exceed the net realizable value, whereas costs relating to holding and disposition of the property are expensed as incurred. REO is analyzed periodically for changes in fair values and any subsequent write down is charged to REO, net on the statements of income. Any recovery in the fair value subsequent to such a write down is recorded, not to exceed the value recorded at acquisition. Recognition of gains on the sale of real estate is dependent upon the transaction meeting certain criteria related to the nature of the property and the terms of the sale including potential seller financing. |
Accrued Liabilities | Accrued liabilities Accrued liabilities at December 31, 2022 and 2021 were approximately $ 1.1 million, the significant components of which are accrued professional and consulting fees (approximately $ 993 thousand and $ 827 thousand, respectively) and accrued REO property taxes and mortgage interest expense (approximately $ 13 thousand and $ 164 thousand, respectively) and accrued interest on the line of credit (approximately $ 61 thousand and $ 47 thousand , respectively). |
Debt Issuance Costs | Debt issuance costs Debt issuance costs are the fees and commissions incurred in the course of obtaining a line of credit for services from banks, law firms and other professionals and are amortized on a straight-line basis, which approximates the interest method, as interest expense over the term of the line of credit. |
Reclassifications | Reclassification A reclassification has been made in the prior year statement of cash flows to reclassify the presentation of formation loan collected from changes in partners' capital to a separate line item within the financing section of the statement of cash flows. There was no change in total cash used in financing activities. |
Recently Issued Accounting Pronouncements | Recently issued accounting pronouncements - Accounting and Financial Reporting for Expected Credit Losses Effective January 1, 2023, RMI VIII adopted Accounting Standards Codification 326, Financial Instruments – Credit Losses (“ASC 326”). The current expected credit loss (“CECL”) methodology required by ASC 326 utilizes a lifetime expected credit loss measurement objective for the recognition of credit losses at the time the financial asset is originated or acquired. The expected credit losses are adjusted each period for changes in expected lifetime credit losses for loans. The CECL methodology replaces the multiple existing impairment methods in current GAAP, which generally require that a loss be incurred before it is recognized. The CECL estimate is forward-looking, and management is required to use not only historical trends and current conditions, but also forecasts about future economic conditions to determine the expected credit loss over the remaining life of RMI VIII’s loans. Management has completed its evaluation and implementation of the adoption of the new standard and concluded that the change to CECL methodology from the incurred loss models presently in use did not result in a material impact to the reported results of operations or financial position upon adoption. |
General Partners and Other Re_2
General Partners and Other Related Parties (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions [Abstract] | |
Schedule of Formation Loan Activity | Formation loan transactions are presented in the following table ($ in thousands). 2022 2021 Balance, January 1 $ 3,361 $ 3,983 Payments received from RMC ( 659 ) ( 466 ) Early withdrawal penalties applied (1) — ( 156 ) Balance, December 31 $ 2,702 $ 3,361 (1) Beginning in 2022, RMC discontinued the specific allocation of early withdrawal penalties it received to the formation loan. The change has no net effect on the amounts paid by RMC to RMI VIII. RMC's scheduled payments total $ 650 thousand annually so that the formation loan is paid in full by December 31, 2026. |
Schedule of Withdrawals of Limited Partner Capital | The table below sets forth withdrawals of limited partners' capital ($ in thousands). Withdrawals 2022 2021 Without penalty $ 11,192 $ 13,221 With penalty 1,250 1,562 Total $ 12,442 $ 14,783 Scheduled, at December 31, $ 13,870 $ 22,472 |
Scheduled Withdrawals of Limited Partner Capital Account | Scheduled withdrawals of limited partners’ capital as of December 31, 2022 are presented in the following table ($ in thousands). 2023 $ 7,019 2024 3,973 2025 1,830 2026 836 2027 196 Thereafter 16 Total $ 13,870 |
Loans (Tables)
Loans (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Secured Loan Principal Transactions | Secured loan transactions are summarized in the following table ($ in thousands). 2022 2021 Principal, beginning of period $ 55,099 $ 74,080 Loans funded 48,419 25,248 Principal collected (1) ( 30,412 ) ( 39,404 ) Loan transferred from related mortgage fund — 1,371 Loans transferred to related mortgage fund ( 3,284 ) ( 5,711 ) Loans sold to non-affiliate ( 9,734 ) ( 485 ) Principal, end of period $ 60,088 $ 55,099 (1) Principal collected in 2022 includes principal collected and held in trust of $ 0 at December 31, 2022 offset by principal collected and held in trust of approximately $ 465 thousand at December 31, 2021 which was disbursed to the partnership in January 2022. Principal collected in 2021 includes principal collected and held in trust of $ 465 thousand at December 31, 2021 offset by principal collected and held in trust of approximately $ 1 thousand at December 31, 2020 which was disbursed to the partnership in January 2021 . |
Secured Loans Characteristics | Secured loans had the characteristics presented in the following table ($ in thousands). December 31, December 31, 2022 2021 Number of secured loans 21 31 Secured loans – principal $ 60,088 $ 55,099 Secured loans – lowest interest rate (fixed) 7.3 % 7.3 % Secured loans – highest interest rate (fixed) 10.8 % 10.8 % Average secured loan – principal $ 2,861 $ 1,777 Average principal as percent of total principal 4.8 % 3.2 % Average principal as percent of partners’ capital, net of formation loan 5.3 % 2.7 % Average principal as percent of total assets 4.3 % 2.6 % Largest secured loan – principal $ 9,000 $ 7,994 Largest principal as percent of total principal 15.0 % 14.5 % Largest principal as percent of partners’ capital, net of formation loan 16.6 % 12.2 % Largest principal as percent of total assets 13.4 % 11.7 % Smallest secured loan – principal $ 437 $ 56 Smallest principal as percent of total principal 0.7 % 0.1 % Smallest principal as percent of partners’ capital, net of formation loan 0.8 % 0.1 % Smallest principal as percent of total assets 0.7 % 0.1 % Number of California counties where security is located 10 12 Largest percentage of principal in one California county 30.7 % 32.1 % |
Secured Loans Distributed within California | The distribution of secured loans by counties is presented in the following table ($ in thousands). December 31, 2022 December 31, 2021 Principal Percent Principal Percent San Francisco Bay Area (2) San Francisco $ 18,425 30.7 % $ 17,694 32.1 % San Mateo 2,519 4.2 7,696 14.0 Santa Clara 12,266 20.4 4,600 8.4 Sonoma — 0.0 576 1.0 Solano 3,550 5.9 — 0.0 Marin 1,099 1.8 1,653 3.0 Alameda 1,687 2.8 6,239 11.3 39,546 65.8 38,458 69.8 Other Northern California Stanislaus 1,301 2.2 — 0.0 Mariposa — 0.0 56 0.1 1,301 2.2 56 0.1 Northern California Total 40,847 68.0 38,514 69.9 Los Angeles & Coastal Santa Barbara 2,044 3.4 2,062 3.7 Los Angeles 5,597 9.3 10,783 19.6 Orange 11,600 19.3 2,192 4.0 San Diego — 0.0 1,088 2.0 19,241 32.0 16,125 29.3 Other Southern California Riverside — 0.0 460 0.8 — 0.0 460 0.8 Southern California Total 19,241 32.0 16,585 30.1 Total principal, secured loans $ 60,088 100.0 % $ 55,099 100.0 % (2) Includes Silicon Valley |
Secured Loans By Property Type | Secured loans summarized by property type are presented in the following table ($ in thousands). December 31, 2022 December 31, 2021 Loans Principal Percent Loans Principal Percent Single family (3) 4 $ 5,874 10 % 16 $ 14,597 26 % Multi-family 3 8,326 14 2 7,550 14 Commercial 12 44,587 74 13 32,952 60 Land 2 1,301 2 — — 0 Total principal, secured loans 21 $ 60,088 100 % 31 $ 55,099 100 % (3) Single family property type as of December 31, 2022 consists of 4 loans with aggregate principal of approximately $ 5.9 million that are non-owner occupied. At December 31, 2021, single family property type consisted of 4 loans with aggregate principal of approximately $ 2.3 million that were owner occupied and 12 loans with aggregate principal of approximately $ 12.3 million that were non-owner occupied. Single family includes 1-4 unit residential buildings, condominium units, townhouses and condominium complexes. |
Secured Loans by Lien Position in the Collateral | At funding, secured loans had the lien positions in the following table ($ in thousands). December 31, 2022 December 31, 2021 Loans Principal Percent Loans Principal Percent First trust deeds 18 $ 55,803 93 % 25 $ 45,992 83 % Second trust deeds 3 4,285 7 6 9,107 17 Total principal, secured loans 21 60,088 100 % 31 55,099 100 % Liens due other lenders at loan closing 8,956 14,988 Total debt $ 69,044 $ 70,087 Appraised property value at loan closing $ 138,924 $ 117,570 Percent of total debt to appraised values (LTV) (4) 55.4 % 62.3 % (4) Based on appraised values and liens due other lenders at loan closing. The weighted-average loan-to-value (LTV) computation above does not take into account subsequent increases or decreases in property values following the loan closing, nor does it include decreases or increases of the amount of senior liens to other lenders. |
Secured Loans Scheduled Maturities | Secured loans scheduled to mature as of December 31, 2022 are presented in the following table ($ in thousands). First Trust Deeds Second Trust Deeds Loans Principal Percent Loans Principal Loans Principal 2023 13 $ 31,575 52 % 11 $ 28,540 2 $ 3,035 2024 2 1,247 2 2 1,247 — — 2025 1 9,000 15 1 9,000 — — 2026 1 1,250 2 — — 1 1,250 2027 2 12,386 21 2 12,386 — — Total scheduled maturities 19 55,458 92 16 51,173 3 4,285 Matured at December 31, 2022 (5) 2 4,630 8 2 4,630 — — Total principal, secured loans 21 $ 60,088 100 % 18 $ 55,803 3 4,285 (5) See Delinquency/Secured loans with payments in arrears below for more information on matured loans. |
Past Due Financing Receivables | Payments in arrears for secured loans (i.e., monthly interest and principal payments past due 30 or more days) at December 31, 2022, are presented in the following tables ($ in thousands). Loans Principal Interest (6) At December 31, 2022 Past Monthly Past Monthly Past Monthly Total Past due 30-89 days (1-3 payments) — — $ — $ — $ — $ — $ — 90-179 days (4-6 payments) 1 1 910 1 24 25 960 180 or more days (more than 6 1 — 3,720 — 433 — 4,153 Total past due 2 1 $ 4,630 $ 1 $ 457 $ 25 $ 5,113 (6) Interest includes foregone interest of approximately $ 200 thousand on non-accrual loans past maturity. Interest for December 2022 is due January 1 , 2023 and is not included in the payments in arrears at December 31, 2022 . |
Secured Loans in Non-Accrual Status | Secured loans in non-accrual status are summarized in the following table ($ in thousands). December 31, 2022 December 31, 2021 Number of loans 1 4 Principal $ 3,720 $ 1,044 Advances 60 116 Accrued interest (7) 233 13 Total recorded investment $ 4,013 $ 1,173 Foregone interest $ 233 $ 1 (7) Accrued interest in the table above is the amount of interest accrued prior to the loan being placed on non-accrual status, net of any payments received while in non-accrual status . Interest income of $ 167 thousand and $ 107 thousand was recognized for loans in non-accrual status in 2022 and 2021, respectively. The amortized cost basis of loans in non-accrual status with no specific allowance at December 31, 2022 and December 31, 2021 is equivalent to the entire balance of loans in non-accrual status since there is no specific allowance recorded for any loan. |
Activity in the Allowance for Loan Losses | Activity in the allowance for loan losses for 2022 and 2021 are presented in the following table ($ in thousands). 2022 2021 Balance, January 1 $ 55 $ 50 Provision for loan loss — 5 Recovery for loan losses — — Balance, December 31 $ 55 $ 55 |
By Days Past Due [Member] | |
Past Due Financing Receivables | Secured loans by payment-delinquency status are presented in the following table ($ in thousands). December 31, 2022 December 31, 2021 Loans Principal Loans Principal Current 18 $ 54,359 25 $ 48,274 Past Due 30-89 days — — 2 5,782 90-179 days 2 2,009 1 56 180 or more days 1 3,720 3 987 Total past due 3 5,729 6 6,825 Total principal, secured loans 21 $ 60,088 31 $ 55,099 |
Impaired Loans [Member] | |
Impaired Financing Receivables | Loans designated impaired and any associated allowance for loan losses is presented in the following table ($ in thousands). December 31, 2022 December 31, 2021 Number of loans 3 4 Principal $ 5,729 $ 1,043 Recorded investment (8) 6,078 1,173 Impaired loans without allowance 6,078 1,173 Impaired loans with allowance — — Allowance for loan losses, impaired loans — — Weighted average LTV at origination 42.3 % 45.4 % (8) Recorded investment is the sum of principal, advances, and interest accrued for financial reporting purposes. |
Average Balances And Interest Income [Member] | |
Impaired Financing Receivables | Loans designated impaired had an average recorded investment and interest income recognized and received in cash as presented in the following table ($ in thousands). December 31, 2022 December 31, 2021 Average recorded investment $ 3,625 $ 8,352 Interest income recognized 296 107 Interest income received in cash 79 98 |
Real Estate Owned (REO) and M_2
Real Estate Owned (REO) and Mortgages Payable (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Real Estate [Abstract] | |
Summary of REO Transactions and Valuation Adjustments | REO transactions and valuation adjustments for 2022 and 2021 are summarized in the following tables ($ in thousands). 2022 REO Valuation Allowance REO, net Balance, beginning of period $ 10,458 $ ( 2,200 ) $ 8,258 Valuation allowance adjustment — 261 261 Dispositions ( 4,547 ) 1,939 ( 2,608 ) Balance, December 31, 2022 $ 5,911 $ — $ 5,911 2021 REO Valuation Allowance REO, net Balance, beginning of period $ 12,044 $ ( 3,239 ) $ 8,805 Valuation allowance adjustment — ( 294 ) ( 294 ) Dispositions ( 1,586 ) 1,333 ( 253 ) Balance, December 31, 2021 $ 10,458 $ ( 2,200 ) $ 8,258 |
Summary of REO, Net | REO, net in operations expense on the consolidated income statements is comprised of the following for 2022 and 2021 ($ in thousands). 2022 2021 Holding costs, net of other income $ ( 256 ) $ ( 299 ) Gain on sales 108 79 Valuation adjustments 261 ( 294 ) REO, net $ 113 $ ( 514 ) |
Line of Credit (Tables)
Line of Credit (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of Activity Involving Line of Credit | Activity involving the line of credit during the years ended December 31, 2022 and 2021 is presented in the following table ($ in thousands). 2022 2021 Balance, January 1 $ — $ 2,453 Draws 11,000 16,847 Repayments ( 1,000 ) ( 19,300 ) Balance, December 31, $ 10,000 $ — Line of credit - average daily balance $ 8,454 $ 6,417 |
Organization and General - Addi
Organization and General - Additional Information (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 USD ($) Installment | Dec. 31, 2021 USD ($) | |
Organizational and General Details [Line Items] | ||
Percentage of profit or loss entitled to general partners | 1% | |
Percentage of limited partners electing distribution of allocated net income by weighted average to total partners capital | 55% | 58% |
Minimum Amount of Time Before Leaving Partnership Without Penalty | 5 years | |
Early Withdrawal Penalty Percentage | 10% | |
Number of Quarterly Installments for Withdrawal From Partnership | 20 | |
Maximum Percentage of Total Limited Partners Capital Available for Liquidation During One Year | 20% | |
Limited partners’ capital | $ | $ 57,616 | $ 69,555 |
Partners' Capital | $ | $ 54,305 | $ 65,568 |
Limited Partner [Member] | ||
Organizational and General Details [Line Items] | ||
Number of Quarterly Installments for Withdrawal From Partnership | 4 | |
Limited Partner [Member] | After Five Year Period [Member] | ||
Organizational and General Details [Line Items] | ||
Number of Quarterly Installments for Withdrawal From Partnership | 20 | |
Benefit Plan Investors [Member] | After Five Year Period [Member] | Internal Revenue Code [Member] | ||
Organizational and General Details [Line Items] | ||
Number of Quarterly Installments for Withdrawal From Partnership | 4 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Additional Information (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 USD ($) Approach | Dec. 31, 2021 USD ($) | |
Summary of Significant Accounting Policies Details [Line Items] | ||
Estimating real property value, number of approaches | Approach | 3 | |
Threshold period past due for impaired loans placed on non-accrual status | 180 days | |
Interest reserve minimum length | 1 year | |
Interest reserve maximum length | 2 years | |
Accrued liabilities | $ 1,100 | $ 1,100 |
Accrued professional and consulting fees | 993 | 827 |
Accrued property taxes and mortgage interest expense | 13 | 164 |
Accrued interest on the line of credit | 61 | $ 47 |
Maximum [Member] | ||
Summary of Significant Accounting Policies Details [Line Items] | ||
Federal insurance limit | $ 250 | |
Threshold period past due for impaired loans to recognize interest income | 180 days |
General Partners and Other Re_3
General Partners and Other Related Parties - Additional Information (Details) | 12 Months Ended | ||
Dec. 31, 2022 USD ($) Loan | Dec. 31, 2021 USD ($) Loan | Apr. 15, 2022 USD ($) | |
General Partners And Other Related Parties Details [Line Items] | |||
Management fee, description | The general partners are entitled to monthly fees for managing the business and affairs of RMI VIII, including management of the partnership’s loan portfolio and operations, of up to 1/32 of 1% of the “net asset value” of the partnership (3/8 of 1% annually). | ||
Loan Brokerage Commissions, Maximum Percent of Assets | 4% | ||
Limited partners’ capital | $ 57,616,000 | $ 69,555,000 | |
Scheduled withdrawals | 13,870,000 | ||
Payable to related party (Note 3) | 154,000 | 47,000 | |
Amount due from manager and related mortgage funds, net | 68,000 | $ 0 | |
Number of performing loans transferred from related mortgage fund | Loan | 2 | ||
Aggregate principal of loans transferred from related fund | $ 1,400,000 | ||
Mortgage loan made to borrower | $ 3,500,000 | ||
RMC and Burwell [Member] | |||
General Partners And Other Related Parties Details [Line Items] | |||
Payable to related party (Note 3) | $ 154,000 | $ 47,000 | |
Number of performing loans transferred from related mortgage fund | Loan | 0 | ||
Aggregate Principal Of Loans Transferred To Related Fund. | $ 3,300,000 | ||
RMC [Member] | |||
General Partners And Other Related Parties Details [Line Items] | |||
Annual scheduled payment of formation loan | $ 650,000 | ||
Related mortage funds Member | |||
General Partners And Other Related Parties Details [Line Items] | |||
Number Of Performing Loans Transferred To Related Mortgage Fund | Loan | 4 | 7 | |
Aggregate Principal Of Loans Transferred To Related Fund. | $ 5,700,000 | ||
Limited Partner [Member] | |||
General Partners And Other Related Parties Details [Line Items] | |||
Scheduled withdrawals | $ 13,870,000 | 22,472,000 | |
Partnership Agreement [Member] | Limited Partner [Member] | |||
General Partners And Other Related Parties Details [Line Items] | |||
Limited partners capital, Scheduled withdrawals | 271,000 | ||
Formation Loan [Member] | |||
General Partners And Other Related Parties Details [Line Items] | |||
Formation loan, advances | 22,600,000 | ||
Receivable from affiliate (formation loan) | 3,000,000 | ||
RMC [Member] | |||
General Partners And Other Related Parties Details [Line Items] | |||
Brokerage commissions paid to RMC | $ 968,000 | $ 429,000 | |
Redwood Mortgage Investors IX, LLC [Member] | |||
General Partners And Other Related Parties Details [Line Items] | |||
Due to Related Parties, Current | $ 1,000,000 | ||
Maximum [Member] | |||
General Partners And Other Related Parties Details [Line Items] | |||
Annual mortgage servicing fee, percentage | 1.50% | ||
Percentage of offering proceeds | 7% |
General Partners and Other Re_4
General Partners and Other Related Parties - Formation Loan Activity (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | ||
Formation Loan - Transactions [Abstract] | |||
Begning Balance | $ 3,361 | $ 3,983 | |
Payments received from RMC | 659 | 466 | |
Early withdrawal penalties applied | [1] | 0 | 156 |
Ending Balance | $ 2,702 | $ 3,361 | |
[1] Beginning in 2022, RMC discontinued the specific allocation of early withdrawal penalties it received to the formation loan. The change has no net effect on the amounts paid by RMC to RMI VIII. RMC's scheduled payments total $ 650 thousand annually so that the formation loan is paid in full by December 31, 2026. |
General Partners and Other Re_5
General Partners and Other Related Parties - Schedule of Withdrawals of Limited Partner Capital (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
General Partners And Other Related Parties Details [Line Items] | ||
Scheduled, at December 31, | $ 13,870 | |
Limited Partner [Member] | ||
General Partners And Other Related Parties Details [Line Items] | ||
Scheduled, at December 31, | 13,870 | $ 22,472 |
Limited Partner [Member] | Capital Withdrawals-without Penalty [Member] | ||
General Partners And Other Related Parties Details [Line Items] | ||
Total, Capital withdrawals | 11,192 | 13,221 |
Limited Partner [Member] | Capital Withdrawals-subject to Penalty [Member] | ||
General Partners And Other Related Parties Details [Line Items] | ||
Total, Capital withdrawals | 1,250 | 1,562 |
Limited Partner [Member] | Capital Subject to Withdrawals Net [Member] | ||
General Partners And Other Related Parties Details [Line Items] | ||
Total, Capital withdrawals | $ 12,442 | $ 14,783 |
General Partners and Other Re_6
General Partners and Other Related Parties - Scheduled Capital Account Withdrawal Requests (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Partners Capital Account Withdrawals [Abstract] | |
2023 | $ 7,019 |
2024 | 3,973 |
2025 | 1,830 |
2026 | 836 |
2027 | 196 |
Thereafter | 16 |
Total | $ 13,870 |
Loans - Additional Information
Loans - Additional Information (Details) $ in Thousands | 12 Months Ended | |||||||||
Dec. 31, 2022 USD ($) Loan MortgageLoan | Dec. 31, 2022 USD ($) Loan MortgageLoan | Dec. 31, 2022 USD ($) Loan MortgageLoan | Dec. 31, 2022 USD ($) Loan MortgageLoan | Dec. 31, 2021 USD ($) Loan MortgageLoan | Dec. 31, 2021 USD ($) Loan MortgageLoan | Dec. 31, 2021 USD ($) MortgageLoan Loan | Dec. 31, 2021 USD ($) MortgageLoan Loan | Dec. 31, 2020 USD ($) | ||
Loans Details [Line Items] | ||||||||||
Loans receivable, term | 5 years | |||||||||
Mortgage loans on real estate extension period | 9 months | 11 months | ||||||||
Number of mortgage | 21 | 21 | 31 | 31 | ||||||
Principal | $ 60,088 | $ 60,088 | $ 60,088 | $ 60,088 | $ 55,099 | $ 55,099 | $ 55,099 | $ 55,099 | $ 74,080 | |
Matured at December 31, 2022, Loan | Loan | [1] | 2 | 2 | 2 | 2 | |||||
Loans receivable number of loans | Loan | 21 | 21 | 21 | 21 | 31 | 31 | 31 | 31 | ||
Loans receivable, percent of aggregate principal | 10% | 10% | 10% | 10% | ||||||
Loans receivable, amortization term | 30 years | |||||||||
Mortgage loans on real estate number of loans renewed | Loan | 9 | 8 | ||||||||
Mortgage loans on real estate principal renewed | $ 32,000 | $ 36,600 | ||||||||
Number of loans sold to an unaffiliated third party | Loan | 4 | 1 | ||||||||
Aggregate principal amount of loans sold to unaffiliated third party | $ 9,700 | 9,700 | $ 9,700 | $ 9,700 | $ 485 | 485 | $ 485 | $ 485 | ||
Gain recognized on sales of loans | 122 | |||||||||
Loans receivable largest loan (in Dollars) | 9,000 | 9,000 | 9,000 | 9,000 | 7,994 | 7,994 | 7,994 | 7,994 | ||
Principal payment in arrears of non-performing loans | $ 4,600 | $ 4,600 | $ 4,600 | $ 4,600 | $ 1,000 | $ 1,000 | $ 1,000 | $ 1,000 | ||
Non-Performing Number Of Loans | 3 | 3 | 3 | 3 | 6 | 6 | 6 | 6 | ||
Interest in arrears of non-performing loans | $ 482 | $ 482 | $ 482 | $ 482 | $ 71 | $ 71 | $ 71 | $ 71 | ||
Matured at December 31, 2022, Principal | [1] | 4,630 | 4,630 | 4,630 | 4,630 | |||||
Past Due180 Days Or More [Member] | ||||||||||
Loans Details [Line Items] | ||||||||||
Principal | $ 3,720 | $ 3,720 | $ 3,720 | $ 3,720 | $ 987 | $ 987 | $ 987 | $ 987 | ||
Delinquent loans, number | MortgageLoan | 1 | 1 | 1 | 1 | 3 | 3 | 3 | 3 | ||
Current [Member] | ||||||||||
Loans Details [Line Items] | ||||||||||
Principal | $ 54,359 | $ 54,359 | $ 54,359 | $ 54,359 | $ 48,274 | $ 48,274 | $ 48,274 | $ 48,274 | ||
Delinquent loans, number | MortgageLoan | 18 | 18 | 18 | 18 | 25 | 25 | 25 | 25 | ||
Not In Non-Accrual [Member] | Past Due 90 Days Or More [Member] | ||||||||||
Loans Details [Line Items] | ||||||||||
Number of mortgage | Loan | 2 | |||||||||
Number of loans | Loan | 0 | 0 | 0 | 0 | ||||||
Mortgage loan, aggregate principal | $ 2,000 | $ 2,000 | $ 2,000 | $ 2,000 | ||||||
Five Year Term or Less [Member] | ||||||||||
Loans Details [Line Items] | ||||||||||
Loans receivable number of loans | Loan | 20 | 20 | 20 | 20 | ||||||
Loans receivable, percent of aggregate principal | 96% | 96% | 96% | 96% | ||||||
Loans Receivable, Remaining Term | 5 years | |||||||||
Interest Only [Member] | ||||||||||
Loans Details [Line Items] | ||||||||||
Loans receivable, percent of aggregate principal | 69% | 69% | 69% | 69% | ||||||
Loans receivable, number of interest only loans | Loan | 13 | 13 | 13 | 13 | ||||||
Largest Loan [Member] | ||||||||||
Loans Details [Line Items] | ||||||||||
Loans receivable largest loan (in Dollars) | $ 9,000 | $ 9,000 | $ 9,000 | $ 9,000 | ||||||
Loans receivable, yield of loan acquired | 7.99% | 7.99% | 7.99% | 7.99% | ||||||
Loans receivable maturity date | Sep. 01, 2025 | |||||||||
Construction Loans [Member] | ||||||||||
Loans Details [Line Items] | ||||||||||
Commitment to lend outstanding | $ 0 | $ 0 | $ 0 | $ 0 | ||||||
Rehabilitation Loans [Member] | ||||||||||
Loans Details [Line Items] | ||||||||||
Loans outstanding | 0 | 0 | 0 | 0 | ||||||
Second Loan [Member] | ||||||||||
Loans Details [Line Items] | ||||||||||
Loans receivable largest loan (in Dollars) | $ 8,800 | $ 8,800 | $ 8,800 | $ 8,800 | ||||||
Loans receivable, yield of loan acquired | 8.375% | 8.375% | 8.375% | 8.375% | ||||||
Loans receivable maturity date | Jul. 01, 2027 | |||||||||
Third Loans [Member] | ||||||||||
Loans Details [Line Items] | ||||||||||
Loans receivable largest loan (in Dollars) | $ 8,000 | $ 8,000 | $ 8,000 | $ 8,000 | ||||||
Loans receivable, yield of loan acquired | 8.375% | 8.375% | 8.375% | 8.375% | ||||||
Loans receivable maturity date | Apr. 01, 2023 | |||||||||
Fourth Loans [Member] | ||||||||||
Loans Details [Line Items] | ||||||||||
Loans receivable largest loan (in Dollars) | $ 6,300 | $ 6,300 | $ 6,300 | $ 6,300 | ||||||
Loans receivable, yield of loan acquired | 7.75% | 7.75% | 7.75% | 7.75% | ||||||
Loans receivable maturity date | Apr. 01, 2023 | |||||||||
[1] See Delinquency/Secured loans with payments in arrears below for more information on matured loans. |
Loans - Secured Loan Principal
Loans - Secured Loan Principal Transactions (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | ||
Receivables [Abstract] | |||
Principal, beginning of period | $ 55,099 | $ 74,080 | |
Loans funded | 48,419 | 25,248 | |
Principal collected | [1] | (30,412) | (39,404) |
Loans transferred from related mortgage funds | 0 | 1,371 | |
Loans transferred to related mortgage fund | (3,284) | (5,711) | |
Loans sold to non-affiliate | (9,734) | (485) | |
Principal, end of period | $ 60,088 | $ 55,099 | |
[1] Principal collected in 2022 includes principal collected and held in trust of $ 0 at December 31, 2022 offset by principal collected and held in trust of approximately $ 465 thousand at December 31, 2021 which was disbursed to the partnership in January 2022. Principal collected in 2021 includes principal collected and held in trust of $ 465 thousand at December 31, 2021 offset by principal collected and held in trust of approximately $ 1 thousand at December 31, 2020 which was disbursed to the partnership in January 2021 . |
Loans - Secured Loan Principa_2
Loans - Secured Loan Principal Transactions (Parenthetical) (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Receivables [Abstract] | |||
Amount includes principal collected and held in trust. | $ 0 | $ 465,000 | $ 1,000 |
Loans - Secured Loans Character
Loans - Secured Loans Characteristics (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 USD ($) Loan County | Dec. 31, 2021 USD ($) Loan County | Dec. 31, 2020 USD ($) | |
Secured Loan Transactions [Line Items] | |||
Number of secured loans | Loan | 21 | 31 | |
Principal | $ 60,088 | $ 55,099 | $ 74,080 |
Average secured loan - principal (in Dollars) | $ 2,861 | $ 1,777 | |
Average principal as percent of total principal | 4.80% | 3.20% | |
Average principal as percent of partners’ capital, net of formation loan | 5.30% | 2.70% | |
Average principal as percent of total assets | 4.30% | 2.60% | |
Largest secured loan - principal (in Dollars) | $ 9,000 | $ 7,994 | |
Largest principal as percent of total principal | 15% | 14.50% | |
Largest principal as percent of partners’ capital, net of formation loan | 16.60% | 12.20% | |
Largest principal as percent of total assets | 13.40% | 11.70% | |
Smallest secured loan - principal (in Dollars) | $ 437 | $ 56 | |
Smallest principal as percent of total principal | 0.70% | 0.10% | |
Smallest principal as percent of partners’ capital, net of formation loan | 0.80% | 0.10% | |
Smallest principal as percent of total assets | 0.70% | 0.10% | |
Number of California counties where security is located | County | 10 | 12 | |
Largest percentage of principal in one California county | 30.70% | 32.10% | |
Minimum [Member] | |||
Secured Loan Transactions [Line Items] | |||
Secured loans - interest rate (fixed) | 7.30% | 7.30% | |
Maximum [Member] | |||
Secured Loan Transactions [Line Items] | |||
Secured loans - interest rate (fixed) | 10.80% | 10.80% |
Loans - Secured Loans Distribut
Loans - Secured Loans Distributed within California (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Loans (Details) - Secured Loans by Property Type [Line Items] | ||||
Secured loans, principal | $ 60,088 | $ 55,099 | $ 74,080 | |
Loans - percent | 100% | 100% | ||
San Francisco [Member] | ||||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||||
Secured loans, principal | [1] | $ 18,425 | $ 17,694 | |
Loans - percent | [1] | 30.70% | 32.10% | |
San Mateo [Member] | ||||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||||
Secured loans, principal | [1] | $ 2,519 | $ 7,696 | |
Loans - percent | [1] | 4.20% | 14% | |
Santa Clara [Member] | ||||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||||
Secured loans, principal | [1] | $ 12,266 | $ 4,600 | |
Loans - percent | [1] | 20.40% | 8.40% | |
Sonoma [Member] | ||||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||||
Secured loans, principal | [1] | $ 0 | $ 576 | |
Loans - percent | [1] | 0% | 1% | |
Solana [Member] | ||||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||||
Secured loans, principal | [1] | $ 3,550 | $ 0 | |
Loans - percent | [1] | 5.90% | 0% | |
Marin [Member] | ||||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||||
Secured loans, principal | [1] | $ 1,099 | $ 1,653 | |
Loans - percent | [1] | 1.80% | 3% | |
Alameda [Member] | ||||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||||
Secured loans, principal | [1] | $ 1,687 | $ 6,239 | |
Loans - percent | [1] | 2.80% | 11.30% | |
San Francisco Bay Area [Member] | ||||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||||
Secured loans, principal | [1] | $ 39,546 | $ 38,458 | |
Loans - percent | [1] | 65.80% | 69.80% | |
Stanislaus [Member] | ||||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||||
Secured loans, principal | $ 1,301 | $ 0 | ||
Loans - percent | 2.20% | 0% | ||
Mariposa [Member] | ||||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||||
Secured loans, principal | $ 0 | $ 56 | ||
Loans - percent | 0% | 0.10% | ||
Other Northern California [Member] | ||||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||||
Secured loans, principal | $ 1,301 | $ 56 | ||
Loans - percent | 2.20% | 0.10% | ||
Northern California [Member] | ||||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||||
Secured loans, principal | $ 40,847 | $ 38,514 | ||
Loans - percent | 68% | 69.90% | ||
Santa Barbara [Member] | ||||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||||
Secured loans, principal | $ 2,044 | $ 2,062 | ||
Loans - percent | 3.40% | 3.70% | ||
Los Angeles [Member] | ||||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||||
Secured loans, principal | $ 5,597 | $ 10,783 | ||
Loans - percent | 9.30% | 19.60% | ||
Orange [Member] | ||||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||||
Secured loans, principal | $ 11,600 | $ 2,192 | ||
Loans - percent | 19.30% | 4% | ||
San Diego [Member] | ||||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||||
Secured loans, principal | $ 0 | $ 1,088 | ||
Loans - percent | 0% | 2% | ||
Los Angeles And Coastal [Member] | ||||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||||
Secured loans, principal | $ 19,241 | $ 16,125 | ||
Loans - percent | 32% | 29.30% | ||
Riverside [Member] | ||||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||||
Secured loans, principal | $ 0 | $ 460 | ||
Loans - percent | 0% | 0.80% | ||
Other Southern California [Member] | ||||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||||
Secured loans, principal | $ 0 | $ 460 | ||
Loans - percent | 0% | 0.80% | ||
Southern California [Member] | ||||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||||
Secured loans, principal | $ 19,241 | $ 16,585 | ||
Loans - percent | 32% | 30.10% | ||
[1] Includes Silicon Valley |
Loans - Secured Loans by Proper
Loans - Secured Loans by Property Type (Details) $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2022 USD ($) Loan | Dec. 31, 2022 USD ($) MortgageLoan | Dec. 31, 2021 USD ($) Loan | Dec. 31, 2021 USD ($) MortgageLoan | Dec. 31, 2020 USD ($) | ||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||||||
Number of secured loans | 21 | 21 | 31 | 31 | ||
Secured loans, principal | $ 60,088 | $ 60,088 | $ 55,099 | $ 55,099 | $ 74,080 | |
Loans - percent | 100% | 100% | 100% | 100% | ||
Single Family [Member] | ||||||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||||||
Number of secured loans | Loan | [1] | 4 | 16 | |||
Secured loans, principal | [1] | $ 5,874 | $ 5,874 | $ 14,597 | $ 14,597 | |
Loans - percent | [1] | 10% | 10% | 26% | 26% | |
Multi-family [Member] | ||||||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||||||
Number of secured loans | Loan | 3 | 2 | ||||
Secured loans, principal | $ 8,326 | $ 8,326 | $ 7,550 | $ 7,550 | ||
Loans - percent | 14% | 14% | 14% | 14% | ||
Commercial [Member] | ||||||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||||||
Number of secured loans | Loan | 12 | 13 | ||||
Secured loans, principal | $ 44,587 | $ 44,587 | $ 32,952 | $ 32,952 | ||
Loans - percent | 74% | 74% | 60% | 60% | ||
Land [Member] | ||||||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||||||
Number of secured loans | Loan | 2 | |||||
Secured loans, principal | $ 1,301 | $ 1,301 | ||||
Loans - percent | 2% | 2% | ||||
[1] Single family property type as of December 31, 2022 consists of 4 loans with aggregate principal of approximately $ 5.9 million that are non-owner occupied. At December 31, 2021, single family property type consisted of 4 loans with aggregate principal of approximately $ 2.3 million that were owner occupied and 12 loans with aggregate principal of approximately $ 12.3 million that were non-owner occupied. Single family includes 1-4 unit residential buildings, condominium units, townhouses and condominium complexes. |
Loans - Secured Loans by Prop_2
Loans - Secured Loans by Property Type (Parenthetical) (Details) | 12 Months Ended | ||||
Dec. 31, 2022 USD ($) Loan | Dec. 31, 2022 USD ($) MortgageLoan | Dec. 31, 2021 USD ($) Loan | Dec. 31, 2021 USD ($) MortgageLoan | Dec. 31, 2020 USD ($) | |
Loans Details [Line Items] | |||||
Amount includes principal collected and held in trust. | $ 0 | $ 0 | $ 465,000 | $ 465,000 | $ 1,000 |
Number of secured loans | 21 | 21 | 31 | 31 | |
Mortgage Loans on Real Estate, Commercial and Consumer, Net | $ 60,088,000 | $ 60,088,000 | $ 55,099,000 | $ 55,099,000 | $ 74,080,000 |
Single Family Property-Owner Occupied [Member] | |||||
Loans Details [Line Items] | |||||
Number of secured loans | Loan | 4 | ||||
Mortgage Loans on Real Estate, Commercial and Consumer, Net | $ 5,900 | $ 5,900 | $ 2,300,000 | 2,300,000 | |
Single Family Property-NonOwner Occupied [Member] | |||||
Loans Details [Line Items] | |||||
Number of secured loans | Loan | 4 | 12 | |||
Mortgage Loans on Real Estate, Commercial and Consumer, Net | $ 12,300,000 | $ 12,300,000 |
Loans - Secured Loans by Lien P
Loans - Secured Loans by Lien Position in the Collateral (Details) $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2022 USD ($) Loan | Dec. 31, 2022 USD ($) MortgageLoan | Dec. 31, 2021 USD ($) Loan | Dec. 31, 2021 USD ($) MortgageLoan | Dec. 31, 2020 USD ($) | ||
Loans Details - Secured Loans by Lien Position in the Collateral [Line Items] | ||||||
Number of secured loans | 21 | 21 | 31 | 31 | ||
Secured loans, principal | $ 60,088 | $ 60,088 | $ 55,099 | $ 55,099 | $ 74,080 | |
Loans - percent | 100% | 100% | 100% | 100% | ||
Liens due other lenders at loan closing (in Dollars) | $ 8,956 | $ 8,956 | $ 14,988 | $ 14,988 | ||
Total debt (in Dollars) | 69,044 | 69,044 | 70,087 | 70,087 | ||
Appraised property value at loan closing (in Dollars) | $ 138,924 | $ 138,924 | $ 117,570 | $ 117,570 | ||
Percent of total debt to appraised values (LTV) at loan closing | [1] | 55.40% | 55.40% | 62.30% | 62.30% | |
First Trust Deeds [Member] | ||||||
Loans Details - Secured Loans by Lien Position in the Collateral [Line Items] | ||||||
Number of secured loans | MortgageLoan | 18 | 25 | ||||
Secured loans, principal | $ 55,803 | $ 55,803 | $ 45,992 | $ 45,992 | ||
Loans - percent | 93% | 93% | 83% | 83% | ||
Second Trust Deeds [Member] | ||||||
Loans Details - Secured Loans by Lien Position in the Collateral [Line Items] | ||||||
Number of secured loans | MortgageLoan | 3 | 6 | ||||
Secured loans, principal | $ 4,285 | $ 4,285 | $ 9,107 | $ 9,107 | ||
Loans - percent | 7% | 7% | 17% | 17% | ||
[1] Based on appraised values and liens due other lenders at loan closing. The weighted-average loan-to-value (LTV) computation above does not take into account subsequent increases or decreases in property values following the loan closing, nor does it include decreases or increases of the amount of senior liens to other lenders. |
Loans - Secured Loans Scheduled
Loans - Secured Loans Scheduled Maturities (Details) $ in Thousands | Dec. 31, 2022 USD ($) Loan | Dec. 31, 2021 USD ($) Loan | Dec. 31, 2020 USD ($) | |
Loans Details Secured Loans By Lien Position In Collateral [Line Items] | ||||
2023, Loan | Loan | 13 | |||
2024, Loan | Loan | 2 | |||
2025, Loan | Loan | 1 | |||
2026, Loan | Loan | 1 | |||
2027, Loan | Loan | 2 | |||
Total scheduled maturities, Loan | Loan | 19 | |||
Matured at December 31, 2022, Loan | Loan | [1] | 2 | ||
Total principal, secured loans, Loan | Loan | 21 | 31 | ||
2023, Principal | $ | $ 31,575 | |||
2024, Principal | $ | 1,247 | |||
2025, Principal | $ | 9,000 | |||
2026, Principal | $ | 1,250 | |||
2027, Principal | $ | 12,386 | |||
Total scheduled maturities, Principal | $ | 55,458 | |||
Matured at December 31, 2022, Principal | $ | [1] | 4,630 | ||
Total principal, secured loans, Principal | $ | $ 60,088 | $ 55,099 | $ 74,080 | |
2023, Percent | 52% | |||
2024, Percent | 2% | |||
2025, Percent | 15% | |||
2026, Percent | 2% | |||
2027, Percent | 21% | |||
Total scheduled maturities, Percent | 92% | |||
Matured at December 31, 2022, Percent | [1] | 8% | ||
Total principal, secured loans, Percent | 100% | |||
First Trust Deeds [Member] | ||||
Loans Details Secured Loans By Lien Position In Collateral [Line Items] | ||||
2023, Loan | Loan | 11 | |||
2024, Loan | Loan | 2 | |||
2025, Loan | Loan | 1 | |||
2027, Loan | Loan | 2 | |||
Total scheduled maturities, Loan | Loan | 16 | |||
Matured at December 31, 2022, Loan | Loan | [1] | 2 | ||
Total principal, secured loans, Loan | Loan | 18 | |||
2023, Principal | $ | $ 28,540 | |||
2024, Principal | $ | 1,247 | |||
2025, Principal | $ | 9,000 | |||
2027, Principal | $ | 12,386 | |||
Total scheduled maturities, Principal | $ | 51,173 | |||
Matured at December 31, 2022, Principal | $ | [1] | 4,630 | ||
Total principal, secured loans, Principal | $ | $ 55,803 | 45,992 | ||
Second Trust Deeds [Member] | ||||
Loans Details Secured Loans By Lien Position In Collateral [Line Items] | ||||
2023, Loan | Loan | 2 | |||
2026, Loan | Loan | 1 | |||
Total scheduled maturities, Loan | Loan | 3 | |||
Total principal, secured loans, Loan | Loan | 3 | |||
2023, Principal | $ | $ 3,035 | |||
2026, Principal | $ | 1,250 | |||
Total scheduled maturities, Principal | $ | 4,285 | |||
Total principal, secured loans, Principal | $ | $ 4,285 | $ 9,107 | ||
[1] See Delinquency/Secured loans with payments in arrears below for more information on matured loans. |
Loans - Secured Loans Summarize
Loans - Secured Loans Summarized by Payment Delinquency (Details) $ in Thousands | Dec. 31, 2022 USD ($) MortgageLoan | Dec. 31, 2021 USD ($) MortgageLoan | Dec. 31, 2020 USD ($) |
Loans (Details) - Secured Loans by Property Type [Line Items] | |||
Mortgage Loans On Real Estate Number Of Secured Loans | MortgageLoan | 21 | 31 | |
Past Due | |||
Secured loans, principal | $ | $ 60,088 | $ 55,099 | $ 74,080 |
Current [Member] | |||
Loans (Details) - Secured Loans by Property Type [Line Items] | |||
Delinquent loans, number | MortgageLoan | 18 | 25 | |
Past Due | |||
Secured loans, principal | $ | $ 54,359 | $ 48,274 | |
Past Due 30-89 Days [Member] | |||
Loans (Details) - Secured Loans by Property Type [Line Items] | |||
Delinquent loans, number | MortgageLoan | 0 | 2 | |
Past Due | |||
Secured loans, principal | $ | $ 0 | $ 5,782 | |
Past Due 90-179 Days [Member] | |||
Loans (Details) - Secured Loans by Property Type [Line Items] | |||
Delinquent loans, number | MortgageLoan | 2 | 1 | |
Past Due | |||
Secured loans, principal | $ | $ 2,009 | $ 56 | |
Past Due 180 Days or More [Member] | |||
Loans (Details) - Secured Loans by Property Type [Line Items] | |||
Delinquent loans, number | MortgageLoan | 1 | 3 | |
Past Due | |||
Secured loans, principal | $ | $ 3,720 | $ 987 | |
Past Due [Member] | |||
Loans (Details) - Secured Loans by Property Type [Line Items] | |||
Delinquent loans, number | MortgageLoan | 3 | 6 | |
Past Due | |||
Secured loans, principal | $ | $ 5,729 | $ 6,825 |
Loans - Schedule of Payments in
Loans - Schedule of Payments in Arrears Past Due Financing Receivables (Details) $ in Thousands | Dec. 31, 2022 USD ($) Loan | |
30-89 days (1-3 payments) [Member] | ||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||
Number of loans | Loan | 0 | |
Number of monthly payments | Loan | 0 | |
Past maturity, principal | $ 0 | |
Monthly payments, principal | 0 | |
Past maturity, interest | 0 | [1] |
Monthly payments, interest | 0 | [1] |
Total payments | $ 0 | |
90-179 days (4-6 payments) | ||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||
Number of loans | Loan | 1 | |
Number of monthly payments | Loan | 1 | |
Past maturity, principal | $ 910 | |
Monthly payments, principal | 1 | |
Past maturity, interest | 24 | [1] |
Monthly payments, interest | 25 | [1] |
Total payments | $ 960 | |
180 or more days (more than 6 payments) [Member] | ||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||
Number of loans | Loan | 1 | |
Number of monthly payments | Loan | 0 | |
Past maturity, principal | $ 3,720 | |
Monthly payments, principal | 0 | |
Past maturity, interest | 433 | [1] |
Monthly payments, interest | 0 | [1] |
Total payments | $ 4,153 | |
Total Payments Past Due | ||
Loans (Details) - Secured Loans by Property Type [Line Items] | ||
Number of loans | Loan | 2 | |
Number of monthly payments | Loan | 1 | |
Past maturity, principal | $ 4,630 | |
Monthly payments, principal | 1 | |
Past maturity, interest | 457 | [1] |
Monthly payments, interest | 25 | [1] |
Total payments | $ 5,113 | |
[1] Interest includes foregone interest of approximately $ 200 thousand on non-accrual loans past maturity. Interest for December 2022 is due January 1 , 2023 and is not included in the payments in arrears at December 31, 2022 . |
Loans - Schedule of Payments _2
Loans - Schedule of Payments in Arrears Past Due Financing Receivables (Parenthetical) (Details) - 180 or more days (more than 6 payments) [Member] $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) Loan | |
Financing Receivable Recorded Investment Past Due [Line Items] | |
Foregone Interest | $ 200 |
Interest, Due Date | Jan. 01, 2023 |
Number of loans | Loan | 1 |
Principal | $ 4,153 |
Loans - Secured Loans in Non-Ac
Loans - Secured Loans in Non-Accrual Status (Details) $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2022 USD ($) Loan | Dec. 31, 2022 USD ($) MortgageLoan | Dec. 31, 2021 USD ($) Loan | Dec. 31, 2021 USD ($) MortgageLoan | Dec. 31, 2020 USD ($) | ||
Loans Details Secured Loans In Nonaccrual Status [Line Items] | ||||||
Number of secured loans | 21 | 21 | 31 | 31 | ||
Mortgage Loans on Real Estate, Commercial and Consumer, Net | $ 60,088 | $ 60,088 | $ 55,099 | $ 55,099 | $ 74,080 | |
Accrued interest | 570 | 570 | 459 | 459 | ||
Non-accrual Status [Member] | ||||||
Loans Details Secured Loans In Nonaccrual Status [Line Items] | ||||||
Total recorded investment | 4,013 | 4,013 | 1,173 | 1,173 | ||
Accrued interest | [1] | 233 | 233 | 13 | 13 | |
Foregone interest | 233 | $ 233 | 1 | $ 1 | ||
Principal [Member] | Non-accrual Status [Member] | ||||||
Loans Details Secured Loans In Nonaccrual Status [Line Items] | ||||||
Number of secured loans | MortgageLoan | 1 | 4 | ||||
Mortgage Loans on Real Estate, Commercial and Consumer, Net | 3,720 | $ 3,720 | 1,044 | $ 1,044 | ||
Advances [Member] | Non-accrual Status [Member] | ||||||
Loans Details Secured Loans In Nonaccrual Status [Line Items] | ||||||
Mortgage Loans on Real Estate, Commercial and Consumer, Net | $ 60 | $ 60 | $ 116 | $ 116 | ||
[1] Accrued interest in the table above is the amount of interest accrued prior to the loan being placed on non-accrual status, net of any payments received while in non-accrual status . Interest income of $ 167 thousand and $ 107 thousand was recognized for loans in non-accrual status in 2022 and 2021, respectively. The amortized cost basis of loans in non-accrual status with no specific allowance at December 31, 2022 and December 31, 2021 is equivalent to the entire balance of loans in non-accrual status since there is no specific allowance recorded for any loan. |
Loans - Secured Loans in Non-_2
Loans - Secured Loans in Non-Accrual Status (Parenthetical) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Non-Accrual Loans | ||
Loans Details Secured Loan Transactions [Line Items] | ||
Interest income | $ 167 | $ 107 |
Loans - Activity in the Allowan
Loans - Activity in the Allowance for Loan Losses (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Receivables [Abstract] | ||
Balance, January 1 | $ 55 | $ 50 |
Provision for loan loss | 0 | 5 |
Recovery for loan losses | 0 | 0 |
Balance, December 31 | $ 55 | $ 55 |
Loans - Secured Loans Designate
Loans - Secured Loans Designated as Impaired Loans (Details) $ in Thousands | Dec. 31, 2022 USD ($) Loan | Dec. 31, 2021 USD ($) Loan | |
Financing Receivable, Past Due [Line Items] | |||
Principal | $ 5,729 | $ 1,043 | |
Recorded investment | [1] | 6,078 | 1,173 |
Impaired loans without allowance | 6,078 | 1,173 | |
Impaired loans with allowance | 0 | 0 | |
Allowance for loan losses, impaired loans | $ 0 | $ 0 | |
Weighted average LTV, at origination | 42.30% | 45.40% | |
Impaired Loan [Member] | |||
Financing Receivable, Past Due [Line Items] | |||
Number of loans | Loan | 3 | 4 | |
[1] Recorded investment is the sum of principal, advances, and interest accrued for financial reporting purposes. |
Loans - Secured Loans Designa_2
Loans - Secured Loans Designated as Impaired Loans (Parenthetical) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Loans Details Secured Loan Transactions [Line Items] | ||
Principal | $ 5,729 | $ 1,043 |
Interest income recognized | $ 296 | $ 107 |
Loans - Impaired Loans - Averag
Loans - Impaired Loans - Average Balances and Interest Income (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Impaired Loans - Average Balances and Interest Income [Abstract] | ||
Average recorded investment | $ 3,625 | $ 8,352 |
Interest income recognized | 296 | 107 |
Interest income received in cash | $ 79 | $ 98 |
Real Estate Owned (REO) and M_3
Real Estate Owned (REO) and Mortgages Payable - Summary of REO Transactions and Valuation Adjustments (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Real Estate Owned REO Details [Line Items] | ||
Balance, beginning of period | $ 8,258,000 | |
Valuation allowance adjustment | (261,000) | $ 294,000 |
Balance, end of period | 5,911,000 | 8,258,000 |
R E O Balance | ||
Real Estate Owned REO Details [Line Items] | ||
Balance, beginning of period | 10,458,000 | 12,044,000 |
Valuation allowance adjustment | 0 | 0 |
Dispositions | (4,547,000) | (1,586,000) |
Balance, end of period | 5,911,000 | 10,458,000 |
Valuation Allowance | ||
Real Estate Owned REO Details [Line Items] | ||
Valuation allowance, balance, beginning of period | (2,200,000) | (3,239,000) |
Valuation allowance adjustment | 261,000 | (294,000) |
Dispositions | 1,939,000 | 1,333,000 |
Valuation allowance, balance, end of period | 0 | (2,200,000) |
R E O Net | ||
Real Estate Owned REO Details [Line Items] | ||
Balance, beginning of period | 8,258,000 | 8,805,000 |
Valuation allowance adjustment | 261,000 | (294,000) |
Dispositions | 2,608,000 | (253,000) |
Balance, end of period | $ 5,911,000 | $ 8,258,000 |
Real Estate Owned (REO) and M_4
Real Estate Owned (REO) and Mortgages Payable - Additional Information (Details) $ in Thousands | 1 Months Ended | 12 Months Ended | |||||||||
Aug. 31, 2021 USD ($) | Dec. 31, 2022 USD ($) a Property | Dec. 31, 2022 USD ($) a Property Loan | Dec. 31, 2022 USD ($) a MortgageLoan Property | Dec. 31, 2022 USD ($) a Property | Dec. 31, 2021 USD ($) | Dec. 31, 2021 USD ($) Loan | Dec. 31, 2021 USD ($) MortgageLoan | Sep. 30, 2022 a | Jul. 31, 2022 a | Jun. 30, 2020 Property | |
Real Estate Owned REO Details [Line Items] | |||||||||||
Real estate owned (REO), net | $ 5,911 | $ 5,911 | $ 5,911 | $ 5,911 | $ 8,258 | $ 8,258 | $ 8,258 | ||||
Other Real Estate, Valuation Adjustments | 294 | ||||||||||
Mortgage servicing fees | 1,004 | 1,089 | |||||||||
Accrued property tax expense | 13 | $ 13 | $ 13 | 13 | 94 | $ 94 | $ 94 | ||||
REO - sales proceeds, net | 2,716 | 216 | |||||||||
Number of real estate properties | Property | 2 | ||||||||||
Number of mortgage | 21 | 21 | 31 | 31 | |||||||
Accounts Payable | |||||||||||
Real Estate Owned REO Details [Line Items] | |||||||||||
Prepaid Insurance | 4 | $ 4 | $ 4 | 4 | |||||||
Negative escrow and unpaid late charges | 230 | 230 | 230 | 230 | 184 | $ 184 | $ 184 | ||||
Partnership Property Held For Sale | |||||||||||
Real Estate Owned REO Details [Line Items] | |||||||||||
Real estate owned (REO), net | $ 5,900 | $ 5,900 | $ 5,900 | $ 5,900 | |||||||
Number of real estate properties | Property | 3 | 3 | 3 | 3 | |||||||
Principal due | $ 996 | ||||||||||
Mortgage interest and fees | $ 96 | ||||||||||
Property Member | |||||||||||
Real Estate Owned REO Details [Line Items] | |||||||||||
Accrued property tax expense | 69 | 69 | 69 | ||||||||
Los Angeles County | |||||||||||
Real Estate Owned REO Details [Line Items] | |||||||||||
Number of real estate properties | Property | 2 | 2 | 2 | 2 | |||||||
San Francisco County | Home Subdivision | Partnership Property Held For Sale | |||||||||||
Real Estate Owned REO Details [Line Items] | |||||||||||
Number of units in real estate property | Property | 1 | 1 | 1 | 1 | |||||||
Proceeds from sale of real estate property | $ 240 | ||||||||||
Gains on sale of real estate | 108 | ||||||||||
San Francisco County | Unit Storage Locker and Signage [Member] | |||||||||||
Real Estate Owned REO Details [Line Items] | |||||||||||
Occupancy rents received | 33 | 77 | |||||||||
Stanislaus County | |||||||||||
Real Estate Owned REO Details [Line Items] | |||||||||||
Other Real Estate, Valuation Adjustments | 261 | ||||||||||
Mortgage servicing fees | 73 | ||||||||||
Stanislaus County | first sale [Member] | |||||||||||
Real Estate Owned REO Details [Line Items] | |||||||||||
Mortgage loaned to borrower | 664 | ||||||||||
LTV percentage | 40% | ||||||||||
Stanislaus County | second sale [Member] | |||||||||||
Real Estate Owned REO Details [Line Items] | |||||||||||
Mortgage loaned to borrower | $ 637 | ||||||||||
LTV percentage | 65% | ||||||||||
Stanislaus County | Commercial Property | |||||||||||
Real Estate Owned REO Details [Line Items] | |||||||||||
Area of real estate property | a | 14 | 14 | 14 | 14 | |||||||
Proceeds from sale of real estate property | $ 2,600 | ||||||||||
Stanislaus County | Commercial Property | Real Estate Transaction One [Member] | |||||||||||
Real Estate Owned REO Details [Line Items] | |||||||||||
Area of real estate property | a | 9 | ||||||||||
Stanislaus County | Commercial Property | Real Estate Transaction Two [Member] | |||||||||||
Real Estate Owned REO Details [Line Items] | |||||||||||
Area of real estate property | a | 5 | ||||||||||
Mortgage Note Payable [Member] | |||||||||||
Real Estate Owned REO Details [Line Items] | |||||||||||
Monthly payments of notes payable | $ 8 | ||||||||||
Derivative fixed interest rate | 4.125% | 4.125% | 4.125% | 4.125% | |||||||
Principal due | $ 1,300 | $ 1,300 | $ 1,300 | $ 1,300 | $ 1,500 | $ 1,500 | $ 1,500 | ||||
Mortgage Note Payable [Member] | LIBOR [Member] | |||||||||||
Real Estate Owned REO Details [Line Items] | |||||||||||
thereafter interest | 2.25% |
Real Estate Owned (REO) and M_5
Real Estate Owned (REO) and Mortgages Payable - Summary of REO, Net (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Real Estate [Abstract] | ||
Holding costs, net of other income | $ (256) | $ (299) |
Gain on sales | (108) | (79) |
Valuation allowance adjustment | (261) | 294 |
REO, net | $ 113 | $ (514) |
Line of Credit - Schedule of Ac
Line of Credit - Schedule of Activity Involving Line of Credit (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Debt Disclosure [Abstract] | ||
Balance, January 1 | $ 0 | $ 2,453 |
Draws | 11,000 | 16,847 |
Repayments | (1,000) | (19,300) |
Balance, December 31, | 10,000 | 0 |
Line of credit - average daily balance | $ 8,454 | $ 6,417 |
Line of Credit - Additional Inf
Line of Credit - Additional Information (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Line Of Credit Facility [Line Items] | ||
Pledged Loans Aggregate Principal Amount | $ 23,200,000 | $ 21,500,000 |
Payments of Debt Issuance Costs | 57,000 | 0 |
Amortization of debt issuance costs | 34,000 | 54,000 |
Interest expense | $ 574,000 | 464,000 |
Ameribor [Member] | ||
Line Of Credit Facility [Line Items] | ||
Line of credit facility, interest rate description | the Ameribor Rate plus three and one-quarter percent (3.25%); and (ii) five percent (5.0%). The fair value of the balance on the line of credit is deemed to approximate the recorded amount because the reference rate plus 3.25% and the other terms and conditions, including the two-year term, of the Revolving Line of Credit and Term Loan Agreement are reflective of market rate terms (Level 2 inputs). | |
Revolving Credit Facility [Member] | ||
Line Of Credit Facility [Line Items] | ||
Line of credit facility, maximum amount outstanding during period | $ 10,000,000 | |
Line of credit facility, conversion of outstanding principal balance to term loan of fee | 0.25% | |
Maturity date extended | Mar. 31, 2026 | |
Line of credit facility, description | RMI VIII has the option at the maturity date to convert - for a fee of one-quarter of one percent (0.25%) – the then outstanding principal balance to a two-year term loan maturing in March 2026. | |
Line of credit facility, interest rate description | per annum rate of the greater of (i) five percent (5%) or (ii) the sum of the one-month LIBOR rate plus three and one-quarter percent (3.25%). | |
Line of credit facility, interest rate | 5% | |
Interest rate, increase (decrease) | 0.25% | |
Line of credit facility, unused line of fee | 0.50% | |
Line of Credit Facility, Commitment Fee Description | there is a quarterly unused line fee equal to one-half of one percent (0.50%) per annum of the average daily difference between the average principal outstanding and fifty percent (50%) of the maximum principal of $10 million. | |
Maximum allowed advance | $ 10,000,000 | |
Debt issuance costs | 57,000 | |
Amortization of debt issuance costs | $ 34,000 | $ 54,000 |
Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||
Line Of Credit Facility [Line Items] | ||
Line of credit facility, interest rate | 3.25% | |
Revolving Credit Facility [Member] | Minimum [Member] | ||
Line Of Credit Facility [Line Items] | ||
Minimum compensating balance amount | $ 1,000,000 | |
Revolving Credit Facility [Member] | Maximum [Member] | ||
Line Of Credit Facility [Line Items] | ||
Line of credit facility, average rate | 50% | |
Line Of Credit [Member] | ||
Line Of Credit Facility [Line Items] | ||
Interest rate, increase (decrease) | 7.14% | |
Minimum tangible net worth | $ 50,000,000 | |
Debt instrument, covenant description | the partnership shall maintain (i) minimum tangible net worth of $50 million, net of amounts due from related companies; (ii) debt service coverage ratio at all times of not less than 2.00 to 1.00; | |
Line Of Credit [Member] | Minimum [Member] | ||
Line Of Credit Facility [Line Items] | ||
Debt service coverage ratio | 1 | |
Line Of Credit [Member] | Maximum [Member] | ||
Line Of Credit Facility [Line Items] | ||
Debt service coverage ratio | 2 | |
Line Of Credit [Member] | Maximum [Member] | Financial Asset, 61 Days Past Due [Member] | ||
Line Of Credit Facility [Line Items] | ||
Delinquency rate | 10% |
Subsequent Events - Additional
Subsequent Events - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Subsequent Event [Line Items] | ||
Limited partners’ capital | $ 57,616 | $ 69,555 |
Revolving Credit Facility [Member] | ||
Subsequent Event [Line Items] | ||
Line of credit facility, interest rate description | per annum rate of the greater of (i) five percent (5%) or (ii) the sum of the one-month LIBOR rate plus three and one-quarter percent (3.25%). |