Subprime veteran Keri Findley builds MSR and HEI bet

Subprime mortgage expert Keri Findley has opened her residential real estate financing opportunities fund to outside investors seeking exposure to mortgage servicing rights (MSRs) and home equity loans, the firm said Wednesday.

The fund, structured as a real estate investment trust (REIT), launched in 2025 but initially relied on internal capital and allocations from a limited number of institutional investors at Tacora Capital Management, Findley’s $1.5 billion asset-based lender.

In the home equity arena, Tacora has already struck a deal to buy up to $300 million of home equity investments from Point, a fintech company focused on the HEI product, Bloomberg reported.

HEIs have drawn scrutiny from state regulators and face legal challenges from homeowners questioning whether the contracts should be treated more like reverse mortgages, with the same consumer protection and disclosure requirements. Findley has served on Point’s board of directors since 2017.

Findley previously built and ran the structured credit business at hedge fund Third Point LLC from 2009 to 2017, focusing on complex mortgage and asset-backed securities in the wake of the subprime crisis.

Earlier in her career, she was an analyst at alternative investment firms EOS Partners and D.B. Zwirn & Co., giving her a background in special situations and nontraditional credit that Tacora is now applying to residential real estate.

Tacora said it’s targeting segments of the mortgage market that remain underserved by traditional bank and securitization channels. This gap has widened as nonbank lenders now originate the majority of U.S. mortgages, while banks have reduced balance-sheet exposure to housing-related assets.

“The proliferation of new ways to structure and service mortgages have increased complexity, precipitating opportunities to identify and capture the mispricing of real estate-linked assets and meaningfully improve servicing,” Findley said in a statement.

“These conditions provide an enduring opportunity to apply our expertise in creative deal construction for innovative companies and hard-to-finance loans.”

The REIT seeks to deliver capital appreciation, stable cash flow and capital preservation in a variable rate environment by combining exposure to MSRs and home equity. MSRs typically benefit from higher rates and slower prepayments, while home equity is more sensitive to home prices and credit performance, giving managers room to balance rate and credit risks across cycles.

Tacora plans to layer in opportunistic investments in bond and loan trading at distressed prices in the secondary market. The strategy targets net returns in the mid to high teens, depending on market conditions, according to the firm.

Demand for the approach may come from university endowments, public pensions, large Registered Investment Advisers (RIAs), family offices and at least one sovereign wealth fund, the company said.

These investors are searching for yield and diversification away from public markets and conventional core fixed income as rate volatility and regulatory capital requirements reshape bank and government-sponsored enterprise participation in the mortgage market.

Tacora, founded in 2021, focuses on deals in the $10 million to $50 million range, targeting companies that do not yet qualify for traditional financing — what it describes as a “bridge to bankability.” An early example was its 2013 financing of student loans to support SoFi’s growth.