Quote from @Chris Seveney:
Quote from @Dan Liston:
Quote from @Chris Seveney:
Daniel,
My foreclosure attorney voiced the same concern about Safeguard. He said that he had never seen investor notes this poorly constructed to limit the rights of the investor. It is truly a nightmare investing with them.
So what can be learned from this? I am curious how many investors had an attorney review the agreement, the note and reviewed the asset/property? This is extremely unfortunate and I think the name does not match their product, but there will be many others out there that do the same - so what can we take and learn from this as well?
Good question, Chris. I agree with Greg, one lesson is to do everything yourself. Another lesson is to research companies online and in forums like this before you do business with them and if you decide to do business with someone, dip your toe in the water slowly and continue to research the company after you start working with them, because things can change quickly.
I have some questions:
1. Were these originally performing loans that went non performing?
2. What was the LTV on these assets?
3. Who was servicing these loans?
4. Were you able to review the collateral and review who the borrower was?
Reason I ask is in note investing it is actually usually pretty difficult to lose money consistently, thus the questions.
1. Yes.
2. 50% - 60%
3. Safeguard Capital Partners with Zimple Money.
4. Yes.
Technically, I have not lost money yet. I don't have time to keep going back and forth here; you are welcome to contact me directly for additional details. Summary: 7 loans outstanding: 4 in foreclosure, 1 in default - trying to develop a plan before I begin foreclosing, 1 current, but has needed multiple payoff extensions, 1 current with no issues. Possibly lower returns than projected because of statutorily mandated interest rates following court judgements. Many hundreds of wasted hours, that if included, would wipe out a significant amount of earnings.
1. Yes.
2. 50% - 60%
3. Safeguard Capital Partners with Zimple Money.
4. Yes.
Update 2/6/25: I had to foreclose on four properties from Safeguard Capital and lost over $200,000. The process took over three years from when the borrower stopped making payments. 100% of their deals have had late payments and/or major issues. I've never experienced such incompetence. I've tried to give them the benefit of the doubt, but they do not learn from their mistakes and simply bury their heads in the sand. It's shocking, sad and definitely frustrating.
100% of their deals have had late payments and/or other major issues.
100% of their deals have had late payments and/or other major issues.
100% of their deals have had late payments and/or other major issues.
100% of their deals have had late payments and/or other major issues.
