All Forum Posts by: Audrey C.

Thanks for all replies.  I am sorry as after I wrote this post, I had to go away on vacation. 

I am now working with other passive investors and hoping they all will cooperate with my intentions to see what is really going on.

@Michael Ran, if you care to supply your business email, I will be happy to email you and ask you what you may need like addresses, financials, etc.

We are investors of a five apartment deal in Houston.  We all mostly live in Austin.  The main investor, we suspect, are falsifying the books as although the rental market is hot here in Texas, we get paltry distribution checks.  He complains that the apartment rental market in Houston is very competitive, that tenants are lured away by move in specials, etc.  How can this be as more and more people are moving into the larger cities of TX.

How can we start an investigation?  I think a lot of the investors are older folks and $50,000 does not mean a lot to them and they pretty much wrote it off.  The lead investor says that the apartments are for sale but no one is buying them since two years ago when they were listed.  I think he is riding high on the rents and leading all of us on.

Please help.

Thanks for all responses.  Very much appreciated.  Always nice to learn from people "in the know" already.

Hi Joe

Nice of you to reply. Sorry, I am a newbie at these kind of deals. It is a first lien performing note. The owner of the owner financed note just wants to cash out of it. The property is owner occupied or if commercial, is like a small grocery store with day to day operation. I am not understanding what UPB is. I know the broker gets a flat fee from the wholesaler, about $2K but that does not affect my profit.

I am just starting to invest in owner finance "small" notes, priced at $50K and less.  Since these notes are mostly out of TX where I live, what is the best way to perform "due diligence?"

I receive a list of notes from a reliable broker.  This is what I normally do:

1. Pick a note or two, that has a high yield first, then working backwards to see the loan-to-value ratio, then the actual discount, and then the terms (10,15,20, or 30 years).

2.  Then, after receiving more info from the broker, I research the value of the property on Zillow, Homes.com, Realtor.com.

3.  I try the local county appraisal district website also for an appraised value but sometimes the property address is just not listed.

4.  Listen to the broker giving me a background of why the owner wants to sell, if there is one.

I have contacted local realtors for a "drive by" to check the condition of the property but most told me it is against their brokers' rules, to receive a small check from me (about $75) for their effort.  Can the broker provide a BPO (broker's price opinion) legally?  Has this ever been done?  I really do not want to hire someone to do a full blown appraisal?

Can a seasoned notes investor/s please help?  Much thanks.