Purchasing Out-of-State Notes

[Zach Bollman]

Hello all, I have been investigating notes available from MLS and other sources, but am a bit reluctant to purchase a note that is outside my state. My concern is working with the borrower should the note become non-performing. Is there anything that I should be aware of, such as certain states to avoid? Additionally, does anyone have advice relating to purchasing notes from different states? Thanks in advance!

[Dan Zitofsky]

@Zach Bollman without taking over this post and rambling on a ton of Info your seeing already, the one thing I preach at every event I speak at or anyone I try to educate is to understand your true goal for note investing. Why are you investing in notes? Why I ask and with that said it will back out on the note you acquire and your exit strategy. 

For example: I’ve been at real estate investing for 27 years and lending/notes for about 18 years. About 7 years ago I changed my vision. My vision now is to truly live passively off my model which I do I believe better than most. It’s not toninpres but to impress upon that I stay focused on my vision of true passive wealth. 

I have 8-9 exit strategies. Most people have 1-2 and neither will get them to their goals if they say they want what we do. The one box I MUST check every time or I don’t buy the note is that I must be willing to hold that house as a rental in my portfolio. Do you really want properties or CFDs worth 20-30k in class D neighborhoods in your so called “Passive” portfolio???? Is it really going to be passive???

When I ask this question to some potential students or attendees at events I'm a speaker at most are terrified and say no but then buy notes valued at 20-30k ARV should they need to take them back as an REO. I know many say I'm not in this to be a landlord. That's great but what happens when you have no choice. Being a landlord is great if done on the right asset in the right emerging market. Ask anyone who has purchased a turn key rental of mine. Yes I even said a turn key rental I sold for cash or on a "Seller Financed" note. So now you created your own note that's clean and you Keep For true passive wealth or feel free to sell as a performer or partial. Think long term first and back out from there and your business will flourish rather than buying a low end note that has vvery few long term strategies. With that I wish you all the best