All Forum Posts by: Andy Mirza

@Joshua Moore Yes, there's added risk but that's why you have the chance to get it at a greater discount. For the smaller investor, your best chance to get a great deal is to find the diamond in the rough that others aren't looking at.

I bought about 20 condos at trustee sales from 2011-2013 in CA. At first, no one was looking at these, which were selling for less than you could buy on the MLS and were also less than the per unit price of multifamily. In 2013, more bidders came on the scene and the deals were gone.

Near the end, I didn't go physically inspect the condos because we had enough experience with them that we could make assumptions based on the averages. With SFRs, I wouldn't assume that the structure was still standing and I'd make sure to see it first.

The investors willing to buy at tighter margins are tough competition and can outbid the smaller guys on the regular basis. I assume that they're willing to take additional risk because they do higher volume and can absorb the occasional loss where the rehab is more than they expect.

@Chris Seveney More than 8 months to confirm a sale? That's crazy! What state is that in and why is it taking so long? Something unusual or just the norm.

It drives me nuts that I have to wait 1 or 2 months for confirmation in judicial states while non-judicial it could be a week or two and done.

It looks like this deal will go through and the odds are in your favor since you have a performing note and you see evidence that the property is listed for sale.

My world is more like Chris's. We buy non performing notes and it's rare that a payoff request results in an actual payoff. Usually, it's a sign that the borrower is going to file bankruptcy. They request the payoff so that they can get accurate numbers when filling out their BK paperwork.

Try Brock & Scott. We've had good experiences with them. In my opinion, getting a competent attorney to handle matters for you is worth the money, especially in saved time. 

@Wesley I.

After x amount of tries to do normal service, you can petition the court to do service by publication as Chris mentioned. It's kind of like the same process used for other legal notices where you have to publish in specific papers for a certain amount of weeks.

It's best to get it done through a private process server with a good reputation for getting people served. They charge more than the sheriff's but they generally have a better chance of getting the job done because they have a better incentive.

Sub service means serving the defendant indirectly. For example, we recently had an occupant agree to accept a "gift" for the defendant at the defendant's residence. Instead of handing the person the gift basket, the process server switched it up and gave the court documents. Sub service added about three days to the answer period.

We have a property preservation company inspect vacant properties once every month or two. Occupied properties, every quarter or two depending if we have contact with the occupant in some way.

@Chad U. We use FCI for most of our loans and they usually hit us up when escrow is short. We then have to cut a manual check to cover.

Are you saying that for normal operations, they have a system in place to monitor & pay the taxes? If so, that'd be great and I'll need to contact them to set it up.

Does anyone have a vendor they can recommend that monitors & pays property taxes for NPNs and REOs? I'm still doing this manually, which is motivating me to find a way to automate the task :)

@Eric J Platter For modeling purposes, different states have different average times to foreclose. This can even be very different when comparing judicial states to each other. Some are just quicker than others. Beginning investors should use the guidelines put out by Fannie but those will show long timelines. An investor who acts more quickly than a bank can easily cut that timeline by 1/3 to 1/2.

Once you have enough experience and data, you can use your actual timelines by state to put into your model.

@Eric J Platter I think you're trying to develop your own financial modeling tool to help you formulate your bids on notes. If so, this is kind of the secret sauce that people don't usually share with others since the better your model, the better competitive advantage you have.

In addition to the numbers, there is definitely an "art" component to note evaluation, which comes from experience and one's take on the current market.

As far the raw data, you should be able to get that easily from tapes of notes for sale. If you don't have that, you should probably start this process by figuring out where to get these tapes yourself direct from the source. You'll need to do this anyway if you want to invest in notes.

@Account Closed I hear you on that. In the last year, title reports were some of the slowest things affected by the pandemic since a lot of government facilities (recorder's offices) were shut down and had limited hours of operation.

In general, we like to be the squeaky wheel when it comes to vendors. No one cares about an asset like an owner does and we make sure we're on top of our processes so that our files have minimum delays. We give new attorneys a few chances and boot them if they're treating us like a number and don't show a sense of urgency or professionalism when handling our loans.