All Forum Posts by: Jason Eyerly

@Rick H. I'm not decided to go with 1sts or 2nds solely. Whichever presents me a lucrative opportunity, and which I can find, is what I will go with. I'm thinking seconds may be easier to start with for economical reasons, and they may be easier to get paid off, or re-performing to re-sell at a later point. They still offer the ability to FC, so providing the property is decent (I've seen many nice 2nd) then I would move in on them, and save the 1sts for when I have more capital or better yet, investor money! However acquiring properties at 30-50% of BPO as-is and going through FC sounds incredibly lucrative. What do you mean when you say notes that are "par"?

Thank you SO much to all of you who have provided me with so much information. I cannot thank you enough as this process starts to become more clear in my head, and something I believe I could pitch to a room of accredited investors!

• Example 3:
  • As Is Value: $35,000
  • ARV: $65,000
  • Original Amount: $51,000
  • Principal Amount: $31,000
  • Status: In Foreclosure
  • Cost Of Acquisition: $15,000 + Fees
  • Rent $750-$800
  • Taxes: Current

This is something I feel somebody would jump all over. If you could acquire it with fees and all for $20,000 and even put $20,000 into repairs you're all in for $40,000. If you rented out at $750 you're still making the 2% rule! Then you can fill it with a tenant and sell it, or just sit on it and cash flow $750/month less expenses. I'd imagine you could get a construction loan or equity loan at that point to finance the construction. 

Granted, this is all hypothetical, but those are actual property examples. I just want to know if I'm missing something big or if I'm actually looking at these in the proper perspective. If someone could give me advice or opinions on how they'd look at these deals I'd appreciate it. 

I'm looking at the FCI Exchange, just to give myself a sample of ideas as I look into notes. I can't seem to get my head around it. Another BP member mentioned to me that so far him and a partner have only gone for non-performing 1sts. You can get NP 2nds for about 20%, but what on average are you looking for in 1sts? Is your primary exit strategy to just foreclose and turn it in to a turn key rental or to attempt to get them re-performing? There doesn't seem to be much of a gap in the UPB and what you get it for to allow you room to work with them on reducing payments, balance, etc.

Take these two notes for example:

• FCI Example 1
• FCI Example 2

• Example 1
  • Purchase @ $26,000: 85% UPB
  • UPB = $30,000
  • This is only a $4,000 reduction on what they owe, how could you get this performing again and keep it profitable?
  • ARV @ $75,000
  • Makes more sense to foreclose and give them the choice to jump back on payments or no-go!
• Example 2
  • Purchase @ $11,500: 40% UPB
  • UPB = $28,000
  • ARV @ $9,500
  • Is this just garbage?

    I'm not sure if there's something I'm missing, haven't read up on, a number I'm leaving out, or if I am just too slow to comprehend NP 1sts. 2nds seem much easier to understand when they are current on the first, as far as your options to get them re-performing, foreclose subject to first, etc. Thanks in advance!

Foreclosure has not begun, I'm just expecting it. I would not be able to afford the home, and they are underwater. That is why I considered possibly being able to use a HELOC to purchase the note.

BP Experts,

I have a question about buying non-performing first notes. This one involves family so it really hits close to home. Recently, my grandfather passed away. Losing his income means my Grandmother cannot afford the house they purchased together (ARV $350k). They took out a home equity loan near the height of the market to put some upgrades on the home. Years later they filed bankruptcy, and almost got foreclosed on (ARM). They made some kind of deal with the bank for lower payments and went on paying the mortgage after the bankruptcy. So, to be honest, I'm not completely sure how many mortgages are on the property, if the home equity loan was paid, or if it was a second note, etc.

Now, with my grandfather gone, my grandmother hasn't made payments in 3-5 months, at all. This tells me the first and second notes would both be non-performing. If I let the foreclosure process start to take place, and have the borrower (my grandmother) willing to work with me, would it be possible for me to purchase these notes before foreclosure at the usual discounts? About .20/1.00 for the 2nd NPN, assuming there is one. That leaves the first at maybe .65/1.00. I'm not sure what the UPB is, but if I could get them for the right price or even set up the deal and provide it to another investor, there may be a way I can help my grandmother stay in her home. If I can personally get the notes and help her make payments I can make them performing again and sell them one day, or keep the property. What would you do in this situation?

Thanks Much,

    Jason

What would everyones recommendations or ideas be on me getting my license and possibly doing property management? I'd like to get my license anyways to save the commissions and get MLS access. Then I was debating on trying to be an agent, or get into property management. I trade equities from the Vegas hours of 6:30-1:00 on M-F, so those hours I would be strapped to my desk, but also able to get a lot of filing or paperwork done. On the other hand, I wouldn't be able to leave the office and attend signings or do showings until after 1. I was thinking this may not be too much of a problem anyways being that I'm willing to work weekends and most people wouldn't go house viewing during the week. Especially with all the possibilities of electronic signatures nowadays. Thoughts? Ideas?

 That sounds like a great process. How are you going to market this? It seems that not only finding a home and getting it under contract, but then finding a buyer (lease option buyer to be specific), will prove to be very difficult. I'd think to take this on full time it'd have to be either very lucrative or you'd have to have a lot of volume.

That would be great! I'm still waiting to hear back from a family friend on whether or not he's gonna be the guy that looks good on paper so that the HML will work with me. It's looking about 80/20 in my favor right now. Assuming that goes through, I will be ready to get into it and would be VERY appreciative of your help.

Hello BPers,

I may find myself having to go back to Vegas soon. I was just about to start my fix and flip adventure here on the east coast. I'm told however, that there is no inventory in Vegas and trying to fix and flip would be near impossible, especially with no other markets nearby. So I'm wondering, what niche could I get into, or how could I get started in REI in Vegas, if not flipping? Thanks in advance.

-Jason E. 

Can you give me an example of these expenses and what they might cost? I can't think of anything other than construction estimates and inspections.