Selling your mortgage note is not all about or just about price. It is also about working wit a buyer who will follow through and actually close at the agreed price. If you have a note to sell and you are not sure who to call, who to trust or what to look for yo will want to watch this short 9 minute video
What’s My Note Worth?
A question all note sellers have and have a right to know.
Timing Your Mortgage Note Sale is everything.
So, when is the correct time to sell your mortgage note?
The following utube video with my friends Walter Wofford and Jim Ingersoll is so to the point as to the value of trusts in any form of a real estate transaction.
They discuss the ultra importance of transactional privacy and how that helps with asset protection.Under what circumstances would you want the general public to know the properties you own?
Trusts provide privacy and effectively separate all of your investment assets. They are not hard to use and provide tremendous privacy in your deals as a trustee is used to hold title and the trust agreement is not recorded at the courthouse.
Under what circumstances would you not like the public to know that you own a property?
What are the benefits of using trusts?
1. Privacy – Keep your name and LLC out of public records
2. Liens and judgments
3. Probate benefits
4. Sell the entity, not the property
5. Personal property trusts for IRAs, cars, boats, etc
Today I cam across this article title,” The Three Ds of Doom: Debt, Default, Depression”. Without sounding negative, it certainly makes one think about the current economy. Everything appears to be booming, at least here in the greater Phoenix Metroplex. But………..what is under the covers. What goes up always comes down. It is a fact of life. Now apply this to the niche business. It is the paper side of real estate.
In the very near future, Capstone will be launching a Utube note training series on buying Notes. One of the topics as part of the due diligence series will be a deep dive into Investment to Value and Loan to Value. In other words, what is the note buyers safety net in the event of a downturn. How to minimize the pain in your portfolio. The only way I know is to have an EQUITY SPREAD. For instance, if a note has a $100,000 unpaid loan balance (aka UPB), what is your risk tolerance. What safety net do you require? The Capstone safety net is an Investment to Value (ITV) not exceeding 65% and a Loan to Value not exceeding 70%. Some say this is too big a filter. I guess time will tell. Anyway–moving on to the article.
The Three Ds of Doom: Debt, Default, Depression
July 17, 2019
“Borrowing our way out of debt” generates the three Ds of Doom: debt leads to default which ushers in Depression.
Let’s start by defining Economic Depression: a Depression is a Recession that isn’t fixed by conventional fiscal and monetary stimulus. In other words, when a recession drags on despite massive fiscal and monetary stimulus being thrown into the economy, then the stimulus-resistant stagnation is called a Depression. Read more
The August 7th Note Investors Forum Meetup focus on:
TOPICS: Several New Case Studies
Where Does a New Note Investor Begin
Bring your questions, This will be an interactive meeting.
The Next Note Investors Forum Meeting will be
Wednesday, August 7th 11:30am-1:30pm
La Famiglia Restaurant, SE corner of Dobson & Guadalupe, Mesa
I receive Harvey MacKay’s inspirational emails from his weekly column. This particular email caught my attention.
I’m back with another installment of street smarts, those skills that go beyond what is taught in school – the lessons we learn by experience and practice. Never underestimate the value and importance of “extracurricular” education.
First idea: Don’t be afraid to make a decision. Be afraid NOT to make a decision. Good judgment is a critically important skill for any person to have, but especially for those in leadership positions. Good judgment is such an important attribute that it is often listed first by employers as required qualities of job applicants.
In business, the success or failure of the organization hinges on judgments made at all levels. Good judgment is the ability to make the best decision possible based on the information you have, without being swayed by others or predetermined ideas.
What kind of a decision-maker are you? Take a few minutes to contemplate the question, because once you become aware of how you make (or don’t make) decisions, you will be more apt to make wiser choices in the future.
Next idea: Never make a decision until you have to. Always bargain for more time to postpone doom. Things can change over time.
For example, there once was a king who was trying to find someone who could teach his horse to fly. As the king was conducting court one day, two guards dragged in a beggar who had just stolen a loaf of bread.
The king said, “Take him away and chop his head off!” As he was being dragged away, he said, “But my king, my king, I can teach your horse to fly. Just give me two years.”
“Granted,” the king said.
As the beggar is being carted out, a guard quizzically asks him, “Why did you promise that?”
“Look … In two years, I may be dead. The king may be dead. Or who knows, maybe I can teach the horse to fly!”
Next idea: Practice the rule of ten thousand. This rule helps determine whether something can’t be done or whether someone doesn’t care enough to get it done.
The Rule of Ten Thousand says, “If I give you an extra $10,000 to get to work by 8 a.m. every work day for six months straight, can you do it?” Watch how fast the obstacles disappear, contingencies are set up, departure time from home is earlier and so on.
You don’t necessarily give people $10,000, but it’s a good way to see if something is possible.
Next idea: Always put the pressure on yourself and tell everyone what your goals are. I do this with all kinds of projects. It’s great motivation.
Next idea: You can take any amount of pain, as long as you know it will end. For example, I was running the Twin Cities Marathon several years back and a woman stopped me with two miles to go and said she wasn’t sure she could finish. She said, “Mr. Mackay, motivate me!” I gave her this lesson on pain as we ran side-by-side.
Next idea: It’s not the people you fire who make your life miserable … it’s the people you don’t fire who make your life miserable. And whenever I say that I get more amens than a Billy Graham sermon.
Next idea: Maximize your education dollars. When your company sends its people to conferences, make sure you get maximum value. At our company, we insist that our people come back from conferences and teach the rest of the staff what they learned. This way we get a terrific return on our investment.
Next idea: Never give an ultimatum unless you mean it. A close friend shared this story of a high stakes negotiation. He’s living in Minnesota and wanted desperately to buy one of his competitors in Los Angeles. He had information that whatever his bid was, the owners had a local businessman who would bid for the business as a wedge to get the price up.
There was a summit conference call with the six owners plus my friend to negotiate and finalize a price. Then came the knockout blow. My friend bid 15-20% more for the company than his previous proposal, but his new offer was on the table during the call only. They either accept it or they don’t. The offer was so good the owners decided to take it. They weren’t going to chance it on their friend matching it.
Mackay’s Moral: Use your street smarts to outsmart your competition.
Over the past few months, Mick Mulvaney has provided smaller indications about how much differently the Consumer Financial Protection Bureau will function under his leadership than it did under the bureau’s former director, Richard Cordray.
But Monday, Mulvaney fully revealed his plan to dramatically alter how the CFPB operates.
The CFPB on Monday released a new strategic plan, in which Mulvaney lays out how the CFPB will now operate and established new goals for the bureau.
“If there is one way to summarize the strategic changes occurring at the bureau, it is this: we have committed to fulfill the bureau’s statutory responsibilities, but go no further,” Mulvaney said in a statement. “By hewing to the statute, this strategic plan provides the bureau a ready roadmap, a touchstone with a fixed meaning that should serve as a bulwark against the misuse of our unparalleled powers.”
According to the CFPB, the plan “draws directly” from the Dodd-Frank Wall Street Reform and Consumer Protection Act, and “refocuses the bureau’s mission on regulating consumer financial products or services under existing federal consumer financial laws, enforcing those laws judiciously, and educating and empowering consumers to make better informed financial decisions.”
Included among the changes is that the CFPB will now focus on “equally protecting the legal rights of all, including those regulated by the bureau,” a tactic Mulvaney previously revealed in a memo to the CFPB’s employees.
Also, it appears that the only new rulemaking the CFPB will engage in will be to “address unwarranted regulatory burdens and to implement federal consumer financial law and will operate more efficiently, effectively, and transparently.”
As Mulvaney previously stated, the CFPB will no longer be “pushing the envelope” when it comes to new rules, regulations, or enforcement.
“Indeed, this should be an ironclad promise for any federal agency; pushing the envelope in pursuit of other objectives ignores the will of the American people, as established in law by their representatives in Congress and the White House,” Mulvaney says in the strategic plan. “Pushing the envelope also risks trampling upon the liberties of our citizens, or interfering with the sovereignty or autonomy of the states or Indian tribes. I have resolved that this will not happen at the bureau.”
In pursuit of this goal, the CFPB establishes a new mission that is much different from what it was previously.
Under Cordray, the CFPB’s mission (as taken from the CFPB’s previous strategic plan) was the following: “The CFPB is a 21st century agency that helps consumer finance markets work by making rules more effective, by consistently and fairly enforcing those rules, and by empowering consumers to take more control over their economic lives.”
The CFPB’s new mission, as laid out by the new strategic plan is this: “To regulate the offering and provision of consumer financial products or services under the Federal consumer financial laws and to educate and empower consumers to make better informed financial decisions.”
According to the new plan, the CFPB will accomplish its new mission by: seeking the counsel of others and making decisions after carefully considering the evidence, equally protecting the legal rights of all, confidently doing what is right, and acting with humility and moderation.
The new strategic plan also lays out new goals for the CFPB.
Previously, the CFPB had four goals:
- Prevent financial harm to consumers while promoting good practices that benefit them
- Empower consumers to live better financial lives
- Inform the public, policy makers, and the CFPB’s own policymaking with data-driven analysis of consumer finance markets and consumer behavior
- Advance the CFPB’s performance by maximizing resource productivity and enhancing impact
Under Mulvaney, the CFPB’s new goals are:
- Ensure that all consumers have access to markets for consumer financial products and services
- Implement and enforce the law consistently to ensure that markets for consumer financial products and services are fair, transparent, and competitive
- Foster operational excellence through efficient and effective processes, governance, and security of resources and information
Part of that first goal will be to “regularly identify and address outdated, unnecessary, or unduly burdensome regulations in order to reduce unwarranted regulatory burdens,” according to the plan.
Under the second goal, the CFPB lays out two objectives that are designed to help meet the goal, including protecting consumers from unfair, deceptive, or abusive acts and practices and from discrimination.
To meet that objective, the CFPB will “enhance compliance with federal laws intended to ensure the fair, equitable and nondiscriminatory access to credit for both individuals and companies and promote fair lending compliance and education,” and “strengthen prevention and response to elder financial exploitation.”
Additionally, under the “implement and enforce the law consistently to ensure that markets for consumer financial products and services are fair, transparent, and competitive” goal, the CFPB will “enforce federal consumer financial law consistently, without regard to the status of a person as a depository institution, in order to promote fair competition.”
Included in the strategies to achieve that objective is focusing supervision and enforcement resources on “institutions and their product lines that pose the greatest risk to consumers based on the nature of the product, field and market intelligence, and the size of the institution and product line.”
The third goal deals mainly with the CFPB’s internal operations, including safeguarding the CFPB’s data, maintaining a “talented, diverse, inclusive and engaged workforce,” and working to manage risk and promote accountability at the bureau.
To read the CFPB’s new strategic plan in full, click here.
Fellow Note Investors:
Our special guest will be Charles Parker of AZ Credit Medix.
He will discuss how to build business credit so a business owner can borrow funding without personal indemnification.
Additionally we discuss the broad basics of seller financing your investment properties with a case study.
Look forward to seeing everyone Tuesday March 6th 11:30am – 1:30pm!!
RESERVE YOUR SPOT @
1644 S Dobson Rd Mesa, AZ Dobson Ranch Inn Resort–Fiesta Bar & Grill
SW Corner of Dobson & Superstition Route 60
investigating real estate mortgages.
This short video explains the variables.. WATCH HERE
Pending home sales rose in December for the third straight month, providing further evidence that 2017 was a positive year for housing, but the National Association of Realtors doesn’t expect the good times to keep rolling.
Now, new data from NAR shows that pending home sales rose in December to the highest level since March 2017, but NAR is concerned that Republican-led tax reform will dent home sales in 2018.
According to a new report from NAR, which was released Wednesday, the Pending Home Sales Index, a forward-looking indicator based on contract signings, increased 0.5% to 110.1 in December from an upwardly revised 109.6 in November.
That marks the third straight month that the index has increased.
But combine continually low housing inventory and the Republican tax plan, which President Donald Trump signed into law late last year, and you have a recipe for a slowdown, according to NAR Chief Economist Lawrence Yun.
“Another month of modest increases in contract activity is evidence that the housing market has a small trace of momentum at the start of 2018. Jobs are plentiful, wages are finally climbing and the prospect of higher mortgage rates are perhaps encouraging more aspiring buyers to begin their search now,” Yun said.
“Sadly, these positive indicators may not lead to a stronger sales pace,” Yun added. “Buyers throughout the country continue to be hamstrung by record low supply levels that are pushing up prices – especially at the lower end of the market.”
According to NAR, there’s an “imbalance” of supply and demand, which has led to price increases of 5% or more for each of the last six years, but Yun expects that to slow this year.
Yun said that while tight inventories are still expected to put upward pressure on prices in most areas this year, he expects overall price growth to shrink, with some states even experiencing a decline, due to the negative effect the changes to the mortgage interest deduction and state and local deductions under the new tax law.
“In the short term, the larger paychecks most households will see from the tax cuts may give prospective buyers the ability to save for a larger down payment this year, and the healthy labor economy and job market will continue to boost demand,” Yun said. “However, there’s no doubt the nation’s most expensive markets with high property taxes are going to be adversely impacted by the tax law.”
Three of the states where the tax bill’s changes to property tax deductions are expected to have a significant impact are already threatening to sue the government over the tax bill.
Last week, the governors of New York, New Jersey, and Connecticut said they plan to sue the government due to the Tax Cuts and Jobs Act’s elimination of certain state and local tax deductions.
The tax bill installs a cap of $10,000 on state and local tax deductions, but several states (including New York, New Jersey, and Connecticut) have state and local tax burdens that far exceed $10,000.
Yun said that he anticipates the changes to the SALT deduction rules to disproportionally impact certain segments of the housing market.
“Just how severe is still uncertain, but with homeownership now less incentivized in the tax code, sellers in the upper end of the market may have to adjust their price expectations if they want to trade down or move to less expensive areas,” Yun said. “This could in turn lead to both a decrease in sales and home values.”