All Forum Posts by: Joshua Andrews

Hi Sandy,

The first can and usually will accept a check from the 2nd position to bring it current. The choice to bring the 1st current should be an equity decision. Once brought current, you finish foreclosure from 2nd position and take possession of the property.

The numbers need to make sense with the idea of still having enough meat on the bone (equity in the property) to make it worthwhile to hold as a rental, sell via creating a new note via owner finance, or REO sale on the open market.

The time it will take to complete your foreclosure in this particular state will weigh heavily on this decision, as you may bring it current, but if it takes you another 8 months to foreclose yourself, the 1st may fall behind again and it may not be worth the effort.

FCI is good. They have great exposure to a large variety of both sophisticated and unsophisticated investors. They also have a great system which functions much like escrow, where collateral, ownership, proof of funds and other items are verified prior to consummating the transaction. 

Understand that they don't directly sell assets, they are a facilitator, much like an escrow or title company. I have purchased and sold assets on FCI and it works quite well.

Josh

Hi Eli,

The reports you need will depend on what information you need access to. If you need all liens and encumbrances, including the current vested owner, then O&E Report is what you need. There are numerous other reports you can order.

What to look for on each report is not a question easily answered. It will depend on what your involvement is in the transaction and what type of lien or property you are buying. There is lots to learn regarding title. Lots. 

Visit ProTitleUSA they have a complete video tutorial section.

Josh

Get an O&E report from ProTitleUSA.

I have looked at this myself. So far the best answer is to combine rental homes with notes. Notes produce the cash flow, while rental homes produce depreciation and other deductions, even if they are break even. 

The beauty of this is the fact that, while you enjoy tax savings for a couple decades, in the end you will own an asset outright (the home) in addition to pocketing the rent check. Keep in mind rent keeps pace with inflation, and as such a $1500 rental payment now may be a $4000 rental payment 15 or 20 years from now.

With regards to note interest income, this is the best blend for tax savings I have seen so far.

From what you've described it's likely the lien is still in place. If you are serious about buying (preferably after you have reached an agreement with the seller, but before you wire funds), pull title on the property to verify the lien is intact.

My understanding without seeing the actual documents, is what you described is saying there is no equity for the secured lien based on FMV. This does not mean the lien is not in force or un-collectable. Let me know if questions.

Josh

Hi Duke,

I am here as well. I will look out for you!

Josh

I'll be there. Looking forward to see you again Bob!

Josh

Hi Bill,

Thanks for clarifying. The type of contact you are talking about can only be done if you are the note owner. At the point of doing DD and contemplating purchasing the note, you have no rights to contact the borrower or begin any legal enforcement on the note. Once you own the note however, the magic words are "legal". You have the servicer or your collection specialist reach out to the owner or just start the foreclosure process. Send out the demand letter. Then if no response start foreclosing. That's really your best option because as you said the borrower is no longer personally liable for the debt. However the property is, provided it is still a valid lien on title. So just start the foreclosure process. If the borrower wants to work something out you will connect. If not you will take the house. 

Hire a servicer or workout specialist to do this for you. That way you are covered, not learning an entirely new trade, and can spend your time looking for more deals.