Buying in Today’s Market
How To, Where To and Why – 2 Tips & A Case
Study on Refinancing




                             ...
Agenda

•   Market Overview
•   Two Buying Tips – to make closing easier
•   C    Study  h
    Case S d – why you need to ...
Part 1: The Market



1. $700B approved – derivatives first


2. $300B (McCain’s desire to target homeowners) – it
   will...
It’s Bad
•   G7 – 1st ever “bailout coordination” cutting rates




                                                      ...
It’s Bad – again
•   Dow – 9,000 exactly 10 ½ years ago




                                         5
It’s Bad – some more

•   Unemployment up 40% ( g 07-Aug 08) and
          p y      p % (Aug      g )
    insurance … wher...
And it’ll Get Worse …

•   Consumption drives roughly 70% of Gross Domestic
            p             g y %
    Product (G...
And it’ll Get Worse …




                        8
Where Would You Rather Be?




                             9
So What Does It All Mean?


The Wall St. Note Selling Machine is Clogged Up
• Wall St holding off on note sales
• One larg...
Examples


Warehouse lender
• Mortgage lender saw repo’s soar
• Warehouse lender asked for $1.5M “haircut” on a
   $6.8M p...
More Examples


Bankruptcies
• They will increase (lenders & borrowers)
• Go after them
• Partner up if you have deals but...
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700 Billion Bailout OPPORTUNITY - Buying Defaulted Mortgages! NoteBuyingProfits.com

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700 Billion Bailout OPPORTUNITY - Buying Defaulted Mortgages! NoteBuyingProfits.com

  1. 1. Buying in Today’s Market How To, Where To and Why – 2 Tips & A Case Study on Refinancing 1
  2. 2. Agenda • Market Overview • Two Buying Tips – to make closing easier • C Study h Case S d – why you need to j d just “d your j b” “do job” 2
  3. 3. Part 1: The Market 1. $700B approved – derivatives first 2. $300B (McCain’s desire to target homeowners) – it will come 3. $1.3-1.4T – Option ARMs “non-performing” $1.3 1.4T non performing 4. Subprime / Alt A / Prime d li 4 S b i Alt-A P i delinquencies ( i (non O ti Option ARM’s) - undetermined 3
  4. 4. It’s Bad • G7 – 1st ever “bailout coordination” cutting rates 4
  5. 5. It’s Bad – again • Dow – 9,000 exactly 10 ½ years ago 5
  6. 6. It’s Bad – some more • Unemployment up 40% ( g 07-Aug 08) and p y p % (Aug g ) insurance … where is it?! 6
  7. 7. And it’ll Get Worse … • Consumption drives roughly 70% of Gross Domestic p g y % Product (GDP) • Consumption is driven by cash available to the common person • And “Mortgage Equity Withdrawal” (MEW) – the money taken out of homes through refi’s – has been a virtual ATM • Next Chart – note the drop • But then also note that MEW only accounted for 10% of peoples’ disposable income 7
  8. 8. And it’ll Get Worse … 8
  9. 9. Where Would You Rather Be? 9
  10. 10. So What Does It All Mean? The Wall St. Note Selling Machine is Clogged Up • Wall St holding off on note sales • One large firm – no trading for past 3 months, $1.7B in performing and non-performing notes • They have only 1 pool out there right now - $9 2 $9.2M But Banks (Portfolio) Are Still Selling • The usual pools are circulating (monthly) • Saprina / Janet lesson: monthly cycles for banks that “own” their loans, goes on … every month 10
  11. 11. Examples Warehouse lender • Mortgage lender saw repo’s soar • Warehouse lender asked for $1.5M “haircut” on a $6.8M pool • Warehouse lender now needs to sell those loans (16 notes) Bank • Monthly pool of $40M (550 loans on average) • Same cycle … no change 11
  12. 12. More Examples Bankruptcies • They will increase (lenders & borrowers) • Go after them • Partner up if you have deals but no money – referral fees Build Yourself a “Niche” Niche • Probates (people always die) / Title Issues • Bankrupt borrowers • Downtown Philly or Cleveland or Detroit • Option-ARM’s Option ARM s 12

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