About Capital Fund 1:
Capital Fund 1 is a private lending firm that provides tailored financing solutions for real estate investors and developers. Founded in 2009 and headquartered in Scottsdale, Arizona, Capital Fund 1 is active across Arizona, Colorado, Texas, Tennessee, Georgia, and North Carolina, specializing in fix-and-flip, construction, commercial bridge, land and lot, DSCR/long-term rental, and foreclosure auction loans. With a focus on speed, flexibility, and service, the company has grown steadily, requiring tools that can keep pace with its expanding loan portfolio and user base.
The Problem:
As Capital Fund 1 expanded into multiple states and broadened its loan offerings, the complexity of its operations increased significantly. The firm wasn’t just originating more loans, it was managing diverse loan products such as construction draws, fix-and-flip financing, and long-term rental (DSCR) programs, each with distinct servicing and reporting requirements. Investor expectations for transparency grew as well, making it critical to provide timely statements, automated distributions, and real-time access to performance data.
“You have to have a strategy to service these loans. You must anticipate the issues that are going to happen with these projects … It’s all about accurate reporting and communicating between our construction draw team, our accounting team, and our servicing team to accurately communicate that data with our borrowers.”
Kevin Highmark
COO, Capital Fund 1
Relying on piecemeal systems initially was challenging and not sustainable. Their early setup required frequent license expansions and manual workarounds to handle loan officer growth and API limitations. Without a comprehensive enterprise-grade platform, processes like trust accounting, ACH payment management, and construction draw tracking became process nightmares, creating inefficiencies and increasing the risk of delays and errors. With their rising success, Capital Fund 1 knew they needed a solution that could not only manage loan servicing at scale but also integrate seamlessly into their business operations to support their expanding portfolio and investor base.
The Solution:
Capital Fund 1 selected The Mortgage Office (TMO) as a single, integrated system of record designed to handle the complexity of private lending, multi-state portfolios, thousands of active loans, and high-touch default and reinstatement workflows. TMO gives servicing, accounting, and construction teams shared visibility to keep draw balances current, calculate payoffs accurately (even in default), and maintain compliance without manual rework.
As COO Kevin Highmark explained:
“TMO is easy to navigate—we can jump into a loan and see everything fast. Payment history, SmartViews, and reporting let us move through defaults and reinstatements quickly and keep construction draws accurate.”
As the COVID-19 pandemic hit and more technology platforms emerged in the private lending industry, Capital Fund 1 found themselves seeking a cloud-based software to navigate the new business environment. The firm trialed an alternative platform and saw how fragile core servicing can be when a product isn’t built for asset-based lending:
“The product that we were promised was not the product that was delivered,”
— Highmark said about an alternative platform to The Mortgage Office.
Payoff calculations faltered in default scenarios, operational glitches slowed teams down, and confidence eroded. The alternative software struggled with core servicing mechanics and stability, driving home the need for a platform that has a demonstrated track record of success in asset-based lending.
Capital Fund 1 quickly returned to TMO and its new web-based version of the software, which had just launched at that time. They restored their reliability and streamlined day-to-day execution, happily leaving behind the instability and manual workarounds encountered elsewhere. Capital Fund 1’s boomerang journey underscores a simple truth: the grass isn’t greener if a platform can’t handle the realities of private lending at scale.
The Results:
Retaining servicing in-house remains a strategic pillar for Capital Fund 1: it preserves borrower relationships and ensures loan documents are executed as intended. TMO supports that model with fast loan-level visibility, efficient default workflows, and fewer hand-offs than an outsourced setup.
Processes that required manual oversight early on are now automated, enabling loan officers to handle higher volumes while focusing on relationships and deal growth. The borrower experience is elevated as well: the servicing team communicates proactively, delivers accurate payoff figures, and moves swiftly through reinstatements. In their experience, these benefits were unattainable with other loan servicing platforms or an outsourced servicer. TMO’s platform flexibility allowed Capital Fund 1 to scale and grow without sacrificing speed or accuracy. Built-in trust accounting and servicing controls strengthened compliance and reduced risk, hallmarks of an enterprise solution.
“The way we deliver the yields our investors expect is by keeping an efficient portfolio—and you can only do that with a great servicing tool and the right servicing team.”
In late 2024, Capital Fund 1 surpassed $5 billion in funded loans, reflecting 16,500+ deals funded and relationships with 5,800+ investors, underscoring its scale and credibility in private lending. Capital Fund 1 has also been recognized as a top 10 private lender, according to Scotsman Guide.
Sustainable growth in private lending depends on the right operational foundation. By sticking with The Mortgage Office, Capital Fund 1 has a technology platform that scales across markets, strengthens investor trust, and maintains the speed and reliability that sets its company apart. TMO delivers what matters and impacts their business the most – accuracy, compliance, transparency, efficiency, and scalability – arming the team with the backbone to serve borrowers and investors with confidence and trust.