All Forum Posts by: Jay H.

Lynn Henley, Just make sure they understand, walking away is temporary relief, but they still may be sought for the deficiency. Also make sure they are very clear with regard to the disposition of the note in a short sale. Many borrowers in Florida believe a short sale, by definition, relieves them from liability under the note. It does not, without a clear waiver of deficiency or settlement on the note. My point is, there are a lot of good deals out there, and flipping a short sale could be a good deal for all, but only in a situation where the distressed party understands their liability.

Lynn Henley what is the borrower/property owners expectations with regard to the deficiency?

Within every market place there are the ethical participants and unethical participants. My issue has been with the Wholesales who target underwater mortgage holders. Back in 2009 I began to see a trend whereas Wholeselles would approach borrowers facing foreclosure. These guys would put the borrowers property under an option contract for up to a year. They would then record the contract in order cloud the title, as a way to insure themselves a profit. They would then act as the sellers negoicator, attempting to convince the lender to accept their deflated offer price, all the while marketing the property for a much higher sale price. Once they secured the sale price they wanted they would do a double closing. If they didn't find a buyer to pay the spread they would simply wait out he lender. All the while, the borrower was facing an ever closer foreclosure ruling, in most cases the borrower was unaware. For the borrowers that met someone that enlightened them of the scam, and tried to sell to another party faced a clouded title. Many times having to pay the wholesaler a "break fee" to remove their NOC(notice of contract). I wrote this article way back in 2011 for Board of Realtors magazine regarding this practice. http://www.tbrnet.org/uploads/file/Magazines/Jan2011.pdf

Welcome, I am a newbie here on BP as well. If you come across any wholesale deals in Tally, myself and my partner will take a look at them. We are in the process of identifying potential investments.

Make sure you read the thread regarding wholesale deals. I cant remember the title, but it was mentioned in the show notes from one of the podcasts (17?)

Jay

My prospective is as follows:
Day one I (or an employee) explain to all tenants that this is a business transaction, and just as you expect certain things (listed in the lease) from me (Landlord), I expect you to follow the lease as well. So, no hard feelings, but if you violate the lease in any way, and that violation cost me an amount greater that the filing fee for small claims, I will sue…..NO Exceptions!! I have only had to act on this 6 times, but I currently have judgments on all. One day within the next 20 years, they will find themselves in a situation where they need my judgment satisfied. When that day comes I will not only collect my cost but will also collect interest @ 4.75% (Florida Judgment rate). Since I have this speech with all tenants when they move in, there is no surprise when they skip out.

Remember when claiming damages to the property, be prepared to have the contractor present during the trial. The courts won’t allow hearsay evidence. If the drywall and doors cost X and labor cost Y. X is admissible with a receipt, but Y will be subject to cross examination.

In all my cases the tenant didn’t show for pretrial hearing, so the judge entered rulings in my favor.

Hello Brian Burke, I have gained a lot of insight from your posts. I will put together two scenarios based on a few current files we are working, from the borrower (current debtor workout) perspective and from the acquires (representing the new buyer) perspective. One thing I will point out is, our scenarios are mainly in Florida which is a judicial state, so our reference to Receivers will simply be to their relationship to the judicial process with regard to the assignment of rents, and management etc. When we refer to the trustee we are referring to the manager (of sorts) of the tranche that this particular loan is held.

Which forum would a post like this be placed?

Mehran Kamari thanks for the warm welcome.

Yes there is a ton of CMBS maturing over the next few years. if there is any interest, I will post some ideas for acquiring short sales on matured commercial properties.

Tom Goans Eric Claxton, assuming you controlled the deal, and the deal could literally be handed to any student housing developer. Also assume you could simply sell the package to the above mentioned developers, but in doing so you would be out of the picture, but you wanted to stay in the deal to both, earn learn and gain exposure. how would you structure the compensation? 5%, 10% of the net? or would you want it based on the gross sale of the finished product.

Thanks for your, and anyone input.

Thanks Chantel Corbett, I will be asking lots of trying questions to the other experienced members, so I hope I can pay it back with my experiences.

Joshua Dorkin Brandon Turner, thanks for the welcome. I feel like I know you two personally, since I have spent the past few weekends listening to the pod casts while doing yard work....

Wendell De Guzman I would love to speak /compare notes regarding the securitization audits, I assume you are referring to RMBS rather than CMBS.

Thanks for the response Eric,
I have them under contract. Its a unique situation. The developer is a friend of one of my close client/friends in Miami. Basically he said for me to put together a memo of understanding regarding what I want out of the deal. The main thing I want is to maintain exclusive brokerage rights for the eventual leasing and/or sale of the commercial, and the sale to the end user REIT. And I want to be a part of the entire process as an assistant (of sorts) in order to learn from one of the biggest student housing developers in Florida. Those parts are easy to set in terms. The hard part is the dollars from the deal. I will get the basic commission on the land purchases. The part I am having trouble with is how much I should ask for on the backside, and should it be a flat fee or a % of the profit. Most of these deals are developed by one group then taken out by a REIT. The project is in the neighborhood of 900+/- beds.