Note Investing Secret Revealed

[Martin Saenz]

The IMN Show this week was awesome...the presenters were 1st class @Tracy Z. Rewey, @Bob Malecki @Anya Sagee @Seraj Saba 

For those of you that missed the show, the common theme was that ‘pricing was up.’ When you hear that statement, what is the first thing that comes to mind?

Whatever you answer will tell you much about yourself. The first thing I thought of was:

1) Great, some folks will be exiting the space or waiting on the sidelines
2) I’ll have to be more diligent to find the deals
3) I need to expand my network, which will increase my deal flow and lead to better priced deals

This ‘pricing was up’ theme helped me focus my attention on meeting with the players to find out HOW they were being more diligent in finding deals. What they told me blew me away.

[Jay Hinrichs]

@Tracy Z. Rewey  agreed for someone of your experience level it makes sense .. its just that begineer who gets talked into thinking this stuff is easier than it really is..

HML in general don't sell notes the investors put up their funds and are part of the origination..

now in my day I had a big line of credit so I funded the loan and would assign out interests as needed

although here in Oregon you can't fractionalize beneficial interests so little tougher on the guys here.

in CA it was primarily fractionalized interests.. And in the day our investors made 12 to 15% and did that for decades with no interruption.. and NO overhead to source their investments other than talking to us and look at the file...

When I took Over Langer mortgage in 1988 ( which was quite a thing for a 32 YO) we had 250 investors and about 50 million out.. but very few loans were one investor one note.. it was all slice and dice.

when I ran my HML company in Oregon.. we did that all internally I had 30 million in Lines of credit so we had no investors.. it was all our own money myself and two partners..

that was cool bank would back fill our deals at 80% of what we loaned.. so we only needed 6 million in cash to run that company.. you talk about ROI we leveraged into 20 to 25% apr deals with only 20% of our own money borrowed from the bank at prime + so our average cost of debt was in the 7% range. we we made the delta plus got 100% return on our 6 million..

I tried at one time to go down the NPN road and buy tapes.. but it was just so much work and at the time the banks were so dysfunctional and as you probably know the amount of Joker brokers out there was off the charts.. I just gave up.. and said hey eaiser ways to make money.

I like the idea though of charging people to learn how to do this though.. no risk make money my kind of deals.