Here are the 10 reasons you shouldn't buy a note. Please check this out and let us know if you have any questions.
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Eddie Speed from NoteSchool
35. Investment to Value Ratio
$45,000 - $65,000
$25,000 - $45,000
Under $25,000
$90,000 - $125,000
$65,000 - $90,000
Low Price Band . . Under $125K
| Price Points
36. What Percentage of a Loan’s
Balance do Loans Cost?
$350K - $650K
$125K - $350K
Under $125K
$650K +
| Price Points
45. Cost of Note - $6,000
Quick rehab over weekend- $1,500
Back taxes- $2,000
Closing costs- $2,000
Total Cost $11,500
Sold in 60 days for - $38,000
$26,500 profit
All funded with
“anxious money”
investor
50. Augusta GA
BPO is $31,500 - UPB is $51,500
Paid $11,000 for the loan - $2,000 back taxes
• Borrower might short sale
• Locale Cash investor = 23K
• 2nd Lien = Augusta Housing and Development.
• Initiated foreclosure
• Est values: $54k
• Estimated market rent $700/m
55. What Determines Note’s Value?
• History
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%
Good Payment Record
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Bad Payment Record
56. Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2010 NA NA 0% 200
%
100% 100% 100% 0% 100% 100% 0% 100%
2011 100% 0% 0% 0% 0% 0% 200% 117% 0% 140% 140% 100
2012 100% 100% 100%
Payment History of Borrower
Payment History:
Owner had gotten behind due loss of job.
Story…
Hedge Fund bought huge group of loans – modified this loan &
they started paying again
Re-Performing Case Study
Could put in a few words about the assessed value, using the pointer (red arrow) to show where you’re looking. Copy paste the shape to point to other sections of the BPO.
Could put in a few words about the assessed value, using the pointer (red arrow) to show where you’re looking. Copy paste the shape to point to other sections of the BPO.
Alternative slide
Alternative slide
Slide piggybacks the Title issue slide and shows them a tax lien moving to 1st position, etc.
Could go into the different lien positions and what they mean as far as getting your money, foreclosure options, etc.
First scenario: First position lien is shoved into 2nd when tax lien is created. Could put loan amt i.e. $100,000 for 1st/$1,000 tax lien to emphasize impact.
Scenario #2: Second position lien is shoved into 2nd when tax lien is created.
Scenario #3 includes other liens that may not be removable…
Maybe Jeanna can build a quick fade from the short sale and foreclosure sale down to what the note buyer paid?
This gem was purchased for $9K in December,2011. This is about 30 minutes from our offices so we are very familiar with this market and liked that the house came with 1 acre.
This property is an hour from where we are so we decided to do a quick rehab on the house. We sent our crew up there for a weekend and put for sale signs in the yard and on the corner of the street. Sunday evening I got a call on the property and a week later, that guy signed a purchase agreement for $38K. He was preapproved with FHA/USDA financing and we are hoping to close next week. There were $2K in back taxes, we have around $1500 in the rehab and we gave the buyer $2K for closing costs. When it closes we will have made a $26,500 profit.
Purchased in January, 2012 for $2,000. When we evaluated this deal, we saw in the collateral package that this lady was offered a short payoff of $20K. There was another letter in the collateral package where she tried to pay it off but the offer date expired. Soon after, GMAC sold the loan. We thought that we could call her up and there would be a very good chance that she would pay this off for the $20K if we offered that deal to her. This was kind of the redeeming factor for us along with the fact that she had lived in this house for 30 years and probably had some emotional equity in it.
After we received the collateral package, we sent the service transfer letter along with the welcome letter. We had a good phone number and email for her so I called a couple of times and she returned my call but was very skeptical of me. I calmed her down and told her that we would honor the GMAC short payoff offer or we could modify the loan.
Kondaur called me on this deal on a Thursday in early March and told me that there was fire damage in this house, it’s vacant and will go to the foreclosure sale at the end of March (March 28th) and they would sell the note for between $20K-$40K. I saw the picture and pulled it up on the auditor’s website to find out that it was built in 2005 and had a tax value of $210K.
Where did the 65% ITV come from?
Show more fees and “surprises” adding to the budget
Show more fees and “surprises” adding to the budget
Person can buy the note for… then miscalculated expenses add up…Fill in unforseen fees.
Use the spreadsheet to show budget difference
Show more fees and “surprises” adding to the budget
Person can buy the note for… then miscalculated expenses add up…Fill in unforseen fees.
Use the spreadsheet to show budget difference
Show more fees and “surprises” adding to the budget