All Forum Posts by: Marco Bario

@Bob Jones - If the unpaid balance (UPB) of your note is $20K, chances are you'd sell the full note or a partial of the full note for less than UPB. That's fine considering you could then purchase notes with an UPB of $10k at a discount as well.

So if your note is performing, you could:

a) Raise enough capital to purchase a smaller note by selling partial interest in the $20K note. You'd end up with two notes

b) Sell the entire $20k note and purchase two smaller ones.

If it's non-performing I haven't heard of selling a partial in that scenario, although I suppose it can happen, but you could sell the entire note and buy two smaller ones.

@Daniel Walker - Your post that started this thread is several months old now, but I recommend checking out For Investors By Investors (FIBI) which has a Long Beach chapter run. FIBI meeting are great because there are no sales pitches allowed. Great networking and information. All of the chapters are run by full time investors. 

https://www.meetup.com/forinvestorsbyinvestors/

I was reading a bit about the new almost 800-page long CFPB Home Mortgage Disclosure Act which takes effect Jan 1, 2018. As I understand it, the document serves to amend the existing HMDA "made by section 1094 of the Dodd-Frank Wall Street Reform and Consumer Protection Act".

I'm curious if investors who purchase and restructure non-performing notes are required to abide by either the current or the new act. 

From the new Act:

"The loan-volume thresholds require an institution that originated at least 25 closed-end mortgage loans or at least 100 open-end lines of credit in each of the two preceding calendar years to report HMDA data, provided that the institution meets all of the other criteria for institutional coverage."

I'm not sure if a small independent investor like myself, even if I reached the 25-loan threshold falls within the scope. And there there is the question of wether purchasing and restructuring loans is viewed as originating.

Thanks,

Marco Bario

@Chris Seveney, @Mark Gibbs, @Account Closed - I really appreciate everyone weighing in on this and sharing their knowledge. 

Gail - Although familiar with it, I hadn't begun to factor in outlying issues like forced place insurance and I wasn't aware yet about higher fees for notes in BK. Makes sense and good to be aware of.

It sounds like arrearages as a bargaining tool is a common approach. Also helpful to understand.

Thanks to everyone.

Hi Daniel - I got started this year in real estate investing as well. And I live in Los Angeles. Be sure to visit some of the local real estate investing club meetings. We have an amazing network an incredibly knowledgeable investors in Southern CA. I recommend: FIBI (For Investors By Investors). Several chapters by location and each chapter runs the meetings a little differently. But there are no sales pitches allowed at any of them. I’m a regular at the South Bay meetings which are held in El Segundo. Went to my first recently in Pasadena as well. Trying to make a Long Beach mtg as soon as I’m able. LAREIA and OCREIA - I recently attended my first of these which was in OC and really enjoyed it. Bruce Norris will be speaking at the next mtg which is in January. I won’t catch him there but he’s also giving the same talk in Culver City and a couple other locations in So Cal. Going to catch him in CC. Local legend as an investor and hard money lender and very knowledgeable. Of course besides meeting content the networking opportunities at the meetings are invaluable. I’ve already met and invested because of contacts I’ve made. Good Luck!

@Chris Seveney - I'm looking for my first NPN note purchases now. These UPB+ opportunities sound like there could be reward, but with greater risk. Not where I'd like to start out but interesting to think about.

I'm feeling that notes investing is like being an escape artist. At one time or another I expect I'll face all sorts of complications – which means my success will come from the ability to think my way out. 

@Paul Chapey - A year ago I had no idea about the real estate community that exists. I've also noticed how successful investors tend to acknowledge those they learned from. Somehow the same 8 or 10 names come up. Pretty amazing how it's developed and how the knowledge has been shared. 

And thank you for your wishes for success. As you may have gathered, I love to learn new things and I can also share that I'm pretty patient. Not expecting to get rich quick. 

That makes a lot of sense Mark Gibbs . From the perspective of the note’s originator I can see where they might be reluctant to discount a note and look past the arrearages balance. If the BPO pointed toward reasonable equity in the house would you consider the opportunity? Since the 1st position holder can’t foreclose without notifying the jr lien holder you’d be in a position of protect yourself.

@Chris Seveney - If you don't mind sharing, I'd love to hear your reasoning behind not paying more than UPB. I assume it has to do with the risk associated with not collecting arrearages.

Thank you!

Marco

Thank you for the Protitleusa recommendation @Chris Seveney. I plan on needing it soon.

Marco