Nervous Note Newbie

[Micki M.]

I've been learning about note investing. I took PPR's performing note course and I really love the concept. I finally found a re-performing second in my price range that looks good numberswise and has the added bonus of being located nearby in Colorado (should the worst case scenario happen and I have to deal with the property itself). I was sent a bunch of paperwork, and I did my own research into taxes, liens, and FMV - helps to be a local realtor in this situation.

It's my first purchase and I don't want to miss a key item so my question is, what documents or information do I need to make sure I've researched?

Here's the deal FYI

$45,897.17 Second Lien – List Price $24,500

FMV: $275,000 +

SR Lien Balance: $198,000

SR Lien Status: Current

Coupon Payment: $247.63

Interest: 5%

Payments Remaining: 356

Thanks!

[Dion DePaoli]

Well, you need to ensure the ownership chain is in tact and perfected to your Seller. This includes assignments and endorsements/allonges.

The file should be in tact and original copies of the collateral should be destine to be shipped to you upon purchase. So the security instrument (mortgage/deed of trust), the note and the title policy.

You will also want to ensure you receive evidence of insurance, the servicing history, the servicing log and file and origination documents. All borrower accounting from the servicer.

The loan looks like it was modified, the remaining term is only 4 months into a standard term (360 or 30 year), it is assumed this is not a new origination since they would only now be considered defaulted, thus not a designation of 're-performing' it would simply be 'delinquent'. So the modification agreement, along with any forbearance agreement that preceded it should be included. The modification agreement might have been recorded already. It should be recorded if not done so already.

That is the nutshell based on what you described.