1st Deed Analysis (FCI Exchange)

[Ben Bakhshi]

I'm starting to dig into marketplaces for notes, and I wanted to try to analyze a deal here.

It is found here

Note Position: 1st Mortgage/Deed of Trust

Loan Status:Performing

Paid To:03/08/2014

Loan Maturity:10/08/2039

Loan Type:Residential

LTV Ratio:80.821%

Original Loan Amount: $95,000.00

Principal Balance: $88,903.36

Est. Market Value: $110,000.00

Valuation Type:Other

Valuation Date:03/28/2014

Note Rate:5.750%

The starting bid is 25% of the UPB.

The seller would earn $22,225 on the transaction.

The buyer would pay $22,225 (plus expenses) in exchange for $554 monthly payments (interest and principal payments) for 25 years .

The new effective interest rate for the buyer is 23%.

Main issues to uncover:

True market value of property (the seller set his own ARV, and this deal makes less sense if the property is worth only $60,000)

If there are unpaid taxes, or other liens, and if the property is foreclosed, does the 1st mortgage get his UPB before all other liens on the property?

This listing fits in the "too good to be true" category for me, and I would assume it won't actually sell for $22,225.