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?
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?
REAL ESTATE PRIVACY–PROTECT YOUR ASSETS
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
Borrowing our way out of Debt
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
AUGUST PHX NOTE INVESTORS FORUM MEETUP
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
Case-Shiller: National House Price Index increased 3.7% year-over-year in March
Case-Shiller: National House Price Index increased 3.7% year-over-year in March
S&P/Case-Shiller released the monthly Home Price Indices for March (“March” is a 3 month average of January, February and March prices).
This release includes prices for 20 individual cities, two composite indices (for 10 cities and 20 cities) and the monthly National index.
Note: Case-Shiller reports Not Seasonally Adjusted (NSA), I use the SA data for the graphs.
From S&P: S&P CoreLogic Case-Shiller Index Shows Annual Home Price Gains Continue to Weaken
The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, covering all nine U.S. census divisions, reported a 3.7% annual gain in March, down from 3.9% in the previous month. The 10-City Composite annual increase came in at 2.3%, down from 2.5% in the previous month. The 20-City Composite posted a 2.7% year-over-year gain, down from 3.0% in the previous month.
Las Vegas, Phoenix and Tampa reported the highest year-over-year gains among the 20 cities. In March, Las Vegas led the way with an 8.2% year-over-year price increase, followed by Phoenix with a 6.1% increase, and Tampa with a 5.3% increase. Four of the 20 cities reported greater price increases in the year ending March 2019 versus the year ending February 2019.
(NOTE: The Phoenix Market did a complete u-turn NORTH. 45% of all inventory was sold in April. What was a down turn, is now back on track. The Phoenix area is growing by 86,000 people every year. Maricopa County is the fasted growing county in country. CLICK HERE FOR THE LOCAL REIA STATS
New to Market – New Performing Notes
Property Locations
IL IN MI OH TN
BPO Range: $33,000 – $70,000
UPB RANGE: $17,785 – $34,860
PURCHASE PRICE RANGE: $19,000 – $26,200
PRICING RANGE: 76% to 90% of UPB
Re-Performing Loans & Seasoned Performing Loans
Click Here to Access
Case Studies ~ Buy A Performing Note – Then It Goes South — Part 3
CASE STUDY 3
This post is a 3rd in a series of 4 regarding how a perfectly good performing note goes south due to life event situation.
This particular note was in the small town of Marshall, IN. The note -Contract for Deed- was originated in 2009. The payors significant other passed in 2010. My IRA purchased the note in 2015. The note was scheduled to mature in June, 2019. I was unaware of the loss of the male payor. The payment history evolved into a rolling 120 days, meaning after 4 months the payor paid the balance or part of the balance to stay out of the forfeiture procedure. However this payment history caught up with the payor in that there was a $5,000 unpaid balance balloon that went beyond the due date of the note.
Fast forward to February, 2019, I was tired of constantly contacting the payor. I did not want to go thru the forfeiture process as to take back the house –due to condition, was not a viable option. Plus 9 months and $3,000 in attorney fees were not viable. In prior conversations, it was discovered she was the caregiver of her mother and was not working. He current husband was not working. After multiple conversations, she realized she needed help. Her Dad was brought into the conversation. He agreed to help her out. They agreed to bring the payments current. In exchange to removing the deceased payors name from the CFD, they agreed to a loan modification which extended the term 12 months, and stay current. If they ran late past 15 days, the newly executed Quit Claim deed would be recorded and my IRA would own the house.
It was a win-win. The payor benefited by having the deceased partner removed from any claim of ownership, the loan was brought current, I avoided the possibility of a 9 month forefeiture procedure and the payor will own her house free and clear in 12 months with the extension of the balloon due date.
Even though the remaining balance was small, the solution was perfect for all.
I have learned, if one works with the payor and developes a dialog, future unfortunate events can be worked out much easier. But, it is all about how can the payor feels and appreciates that they are being helped so they will be open to a solution which also benefits the note holder in the event needed.
This case study was presented at the May 1 Note Investors Forum Meetup
10 Numbers That Prove That America’s Current Financial Condition Is A Horror Show
I am passing this information along, not a a pessimist but, rather a realist in that history does repeat itself. The Feds have been kicking the can down the road for a long time.
How does this relate to notes? Capstone Capital USA is a value buyer of real estate assets verses a spectulative buyer. As such we only buy assets with a 35%-40% equity cushion — with a strong Payment history and seasoning on performing notes. With proper and detailed due diligence, notes are & will be a safe haven. Safety and security is everything. The following article from the Economic Collapse clearly articulates what is in front of our economy…………………
America’s long-term “balance sheet numbers” just continue to get progressively worse. Unfortunately, since the stock market has been soaring and the GDP numbers look okay, most Americans assume that the U.S. economy is doing just fine. But the stock market was soaring and the GDP numbers looked okay just prior to the great financial crisis of 2008 as well, and we saw how that turned out. The truth is that GDP is not the best measure for the health of the economy. Judging the U.S. economy by GDP is basically like measuring the financial health of an individual by how much money he or she spends, and I will attempt to illustrate that in this article. To read more CLICK HERE.
Street Smarts puts you in the fast lane to Outsmart your Competition
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.
http://www.harveymackay.com/this-weeks-columns/