All Forum Posts by: David Putz

@Michael Jones being in the institutional note space for over 10 years we just held a webinar, with panelists, on purchasing seller/owner finance. For us we buy based on yield/irr, if it is performing.

So the discount depends on a few things. What is the interest rate, what state is it in, how many payments are left, how much is the property worth and a few more data points. We have a full model that we use to price our assets at. Hope this helps.

@Ben Lake in my years of doing notes there is a hand full of successful stories I have heard of. It sounds good however there is a lot of issues.

@Peter Halliday in my personal note investing experience population does come to into factor in certain situations.  For us DOM matters more than population.  If you have a large population however the DOM is very high, that tells us things are not moving.  That can be just as bad as a low population area.  We built our note investing model to capture and review this. 

Looking for those who are versed in calculating probabilities notes. I am looking to increase our bidding model to include probability. Anyone have suggestions how to do that and capture large data?

Fields I am interested in are

How many BKs start and fail

How many equity deals go to fc vs reinstate

How many underwater deals go fc

Etc...

Note investing styles of 2010 are done, How are putting yourself in the best chance to succeed in note investing and seller financing for 2021?

@Tim Lowrie I will add to @Chris Levarek comment.  We have been investing in notes since 2010.  Its a great way to invest and it is very similar to rentals.  Note investing can still take up some time however you choose to invest in a fund (passive) or you can dive in yourself and connect with other note investors to share the time.  Feel free to reach out. 

@Andy Mirza well said. For us:

1) Always look where others are not.

2) Focus on your network

3) Being open to new strategies even if they are others who don't have your experience

4) Being thankful for those who we have leaned on for all these years.

@Bill McCafferty thanks Bill ya, I been limiting myself to Facebook and LinkedIn for past 10+ years but a few of my followers asked me to jump over here.

@Barry H. If your interested in selling connect and we can see what we can do. We price our performing notes a little differently than most, we use Xirr and not yield.

@Barry H. I understand what your saying however going into a note purchase assuming only one exit, perform until maturity, is not always reasonable. At times a performing loan defaults just because it sells to another lender. There is also chances of being refinanced and property selling. If any of these happens then the returns could end up poor. If you would like, send them over and I'll share how we would price them.