Getting Started: Obtaining Tapes

[David Piqueira]

Hello!

I'm just starting out in note investing and trying to figure out some of the basic first steps. I would like my first one to be a performing note on a 1st mortgage. This feels like a generally safe way to get my feet wet and learn about the process of purchasing a note. A lot of what I have been reading is pretty high level and talks about the general idea behind note investing, but finding anything specific has been kind of difficult. I'm guessing this is because note investing is not quite as cookie cutter as other types of real estate investing, and there just aren't as many people doing it.

As far as I can tell the first step is to contact the asset managers of different financial institutions and ask them to provide a tape listing the different notes they have for sale. Are there any guidelines as to which institutions to contact? I have read to stay away from larger banks because they are only really interested in dealing bundles of notes, not one-offs. Does location of the bank really matter? Or should I really just try to contact as many banks as possible, fire away emails, and take a look at what comes back. I'm getting a little bit wrapped around the axle trying to figure out if i should target specific banks or if i should just wholesale try to contact as many institutions as possible.

I'm also wondering how you feel about going through online websites to purchase notes (PPR, FCI Exchange) vs. obtaining tapes from financial institutions?

I look forward to learning more about note investing and become a more active member of this forum. Thanks for any replies! 

-Dave

[Patrick Desjardins]

BS advice above. Why is he not going to have access to "high quality notes or good pricing"?

We've mentioned 100 times on this forum to start your pricing at 12% irr on performing notes. That's been pretty standard knowledge with the buyers and sellers I've talked to, and I sold my last one at 12.5. Not sure why he would have worse pricing as a newbie.

Same thing with quality of the notes. Why would his reperformers be worse than anyone else's?

I know some people here are fishing for JV partners but misleading people isn't going to get you anywhere and you will be called out on it.

There is nothing wrong with starting out with a performing or reperforming note if it gives you confidence in notes and fits your strategy.