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Higher Home Prices, Tougher Lenders Making Mortgages More Valuable

Improving real estate values nationwide make it a good time to own individual mortgages, says Bayard Closser, portfolio manager for the Vertical Capital Income Fund. Closser says the hottest real estate markets are in California, Texas, Florida and Arizona. He says interest rates are low, which means fewer prepayments, but it's still difficult for buyers to get a mortgage because of a tough regulatory environment and stricter qualifications. Finally, Closser says Vertical is launching its Vertical Capital Innovations MLP Energy Fund because the greater need for energy infrastructure will be a boon for master limited partnerships.