LM Funding Reports Partnership to Collect Unsecured Debt
TAMPA, Fla., April 6, 2018 (Newswire.com) - LM Funding America, Inc. (NASDAQ:LMFA) (NASDAQ:LMFAW), a technology-based specialty finance company offering unique funding solutions to community associations, is announcing that it has partnered with Debt Management Partners, LLC (“DMP”) to provide consulting and debt collection services to monetize an unsecured debt portfolio beneficially owned by LMFA and its funded community associations.
DMP has been a niche leader in liquidating delinquent accounts receivable since 2004 and will provide pre-litigation services for the portfolio accounts. DMP and LMFA will share litigation costs to bring unresolved claims to final judgment status and assist in monetizing these judgments. The contract covers a portfolio with face value of over $25 million carried at no book value by LMFA. DMP and LMFA will split the collection proceeds based upon the stage in which an account is collected. The base period of performance for the initial contract runs through March 31, 2019.
“When banks take title of a home through foreclosure they often are not required to pay the full amounts owed to the community association leaving the remaining homeowners to pay the shortfall left by their former neighbors. The prior owner remains responsible for these past due amounts even though the debt is no longer secured by a lien against real property. Almost every community association in America has unsecured accounts receivable on their financial statements and our funded communities are no different. We have contracted with DMP to reach out to former homeowners and arrange for the fulfillment of their obligations to their former neighbors,” said Bruce Rodgers, LM Funding’s Chief Executive Officer.
“Litigating unsecured claims against former homeowners can be cost prohibitive for community associations undertaking this on their own. Our agreement with DMP will hopefully avoid litigation where possible but also identify accounts where pursuing a judgment will be cost-effective given the efficiencies provided to lawyers using our proprietary software. Our software is also uniquely suited to aggregate this type of debt and we intend to begin purchasing unsecured debt from community associations in the near future,” Rodgers concluded.
About LM Funding America
LM Funding America, Inc., together with its subsidiaries, is a technology-based specialty finance company that provides funding to nonprofit community associations (Associations) primarily located in the state of Florida, as well as in the states of Washington, Colorado and Illinois. The company offers funding to Associations by purchasing a certain portion of the associations’ rights to delinquent accounts that are selected by the Associations arising from unpaid Association assessments. It is also involved in the business of purchasing delinquent accounts on various terms tailored to suit each Association’s financial needs, including under its New Neighbor Guaranty™ program. The company was founded in 2008 and is based in Tampa, Florida. The company’s common shares and warrants trade on the NASDAQ Capital Market under the symbols “LMFA” and “LMFAW”.
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LM Funding America, Inc.
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Source: LM Funding America, Inc.