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					Greater Sacramento Edition

                                                            Special Feature

                         First Capital Mortgage
                             High Returns, Low Risk — An Enviable Position
                                             GREATER SACRAMENTO M.D. NEWS   FEBRUARY/MARCH 2008 | a
                                                                                                         special feature

First Capital Mortgage
High Returns, Low Risk — An Enviable Position
By Walt Williams

   With money for conventional real estate loans growing scarce      There was a niche to be filled when the company changed its
at the same time return on conventional investments seems to       strategy, he said. And now, in the last 18 months, things have
be stuck in the doldrums, the people at First Capital Mortgage     boomed as conventional lending has shriveled.
are finding themselves in an enviable position.                       The company these days is a high-energy operation in which
   They are having a field day finding high-return opportunities     Miller is joined by Steve Botos and Stephen Dougan, both of whom
for their investors by arranging low-risk loans for borrowers      serve as Vice Presidents for Investor Relations. The two men came
who find themselves in unusual circumstances.                       aboard from widely different fields, but both came because they
   “Part of what we do is magic — matching the right borrower      were attracted to First Capital’s way of doing business.
with the right investor,” says First Capital President Chris         Together, the three steer the operation, locating borrowers and
Miller. “It didn’t start out this way. We were a conventional      investors, and working diligently to keep things balanced.
lender when First Capital was founded in 1994, but in 2000 we        “We fight a battle. Do we not have enough investors? Do we
converted to this private-money, asset-based lending.”             have too many investors? We meet every other day to discuss
                                                                   where we are and what we need to do,” Miller says.
  ON THE COVER: (From Left To Right) Stephen Dougan, Kelly           “And no one has more fun than us,” he says. “We play golf
  Palmer, Chris Miller, Cary Greisen, Maeghen Berke, Steve Botos   every Friday, no matter what is going on.”
                                                                                                     “Over the years I got to know Chris,
                                                                                                  and when I got to see what sort of opera-
                                                                                                  tion he had here and he asked me to join
                                                                                                  him, I just said, ‘Let’s do it.’”
                                                                                                     Dougan is an attorney with a successful
                                                                                                  personal injury practice in Sacramento.
                                                                                                  Several years ago he invested some money
                                                                                                  with First Capital, then became friends
                                                                                                  with Miller and took to the company’s
                                                                                                  way of doing business. Now he balances
                                                                                                  his practice and time between the two.
                                                                                                     “As a trial attorney I make people do
                                                                                                  the right thing. But this was the first time
                                                                                                  I could be in a business where everyone
                                                                                                  was winning,” he says. “Projects get built;
                                                                                                  investors get good returns on their money.
                                                                                                  It fills both needs.”
                                                                                                     The personal touch is what makes the
  Actually, the trio meets every afternoon in the office to take stock     operation work, the three men agree.
and have fun, says Botos, a former financial planner and dedicated            “We treat all our customers like friends, and they often are
golfer, who at age 60 passed his Players Ability Test to start the pro-   friends. We are not just interested in this deal, but in a lifetime
cess to become a PGA pro and worked for several years recruiting          of business,” Dougan says.
members to the Granite Bay and Catta Verdera country clubs.                  The three look not so much for individual borrowers and inves-
tors as for investors and borrowers who
mesh with one another, says Miller.
   “Our big advantage is our ability to
evaluate a deal,” he says. “You really have
to weed through them to find the real
opportunities, and we make sure our
investors are presented with the best.”
   The advantage comes from the years of
experience that began when Miller noticed
a niche developing in the market when he
was working as a conventional lender.
   There was a demand for loans of three
months to two years by borrowers with
excellent assets who were nevertheless shut
out of the usual lending markets by unusual
circumstances. At the same time, there
was demand for low-risk opportunities for
people who need to invest $150,000 to $1 million with a return       grew up in the business and learned from her late father, who
in the range of 12% to 15%.                                          was a long-term associate of Greisen.
   It has proven to be a successful combination, especially since       Greisen is a McGeorge law school graduate who had been prac-
First Capital’s competitors concentrate on smaller loans, leaving    ticing in the Sacramento area as a real estate attorney for over 20
First Capital’s investors with the high-end properties.              years and met Miller in the course of business. “We hit it off and
   There is no particular real estate niche where First Capital      became friends socially. Then we realized that his business and
concentrates, however. “We’ve been steady for the last 10            my area of practice were a natural fit,” says Greisen.
years, and over the last 18 months we’ve boomed because of the          As Greisen sees it, the future for both West State and First
decline in conventional lending markets,” says Miller. “People       Capital is bright.
come to us because they need private money. It doesn’t matter           “West State has had a steady business since its formation, but
what type of development it is; we do it all: residential, com-      the focus now will be to grow the business by contacting people
mercial, mixed-use, any real-estate asset.”                          within the industry to let them know how our company is unique.
   First Capital’s loans all are backed by trust deeds, and the      We let prospective clients know they will have the added benefit
company can boast that it has never had an investor lose a dime      of dealing with both an established foreclosure company and an
of their investment.                                                 experienced attorney to ensure a high level of service, expertise
   Recently, Miller and Cary Greisen purchased West State            and accountability in the processing of their files.
Foreclosures, L.L.C., a company that has processed nonjudicial          For Miller, the uncertainty of today’s financial situation does
foreclosures throughout California since 2000.                       not foretell uncertainty for First Capital.
   “We bought it as an investment with the boom in foreclosures         “If the situation gets tighter, we’ll still continue to boom
in this market,” says Miller. “We purchased the firm because it       because there is always a need for our product. There always
fits perfectly with our business, and we get a lot of foreclosures,   will be those who can’t get conventional financing,” he says.
thankfully, not associated with us.”                                    Dougan agrees, saying, “As the word spreads, we will do big-
   When investors put up their money, First Capital, through West    ger projects and more projects. We will have more clients.”
State, completely services the notes from origination to payoff.        For Botos, his colleagues are too shy in expressing optimism.
   “If there is a problem, we have West State here and they are      “Over the next five years we’re going to double or triple in size
a foreclosure company who can take care of everything from           without question.
beginning to end,” Miller says.                                         “An advantage I have is age,” he says. “When people are 40
   Greisen is a principal in West State as well as First Capital’s   they figure they can take risks. People my age — and there
real estate attorney in the culmination of a relationship that       will be more and more of us — love to see that check coming
goes back to First Capital’s founding. Likewise, West State’s        in every month with 12% to 15% interest.”
General Manager and foreclosure officer is Kelly Palmer, who             For more information, call First Capital Mortgage at (916) 788-7444. ■