All Forum Posts by: Mike Mitchell

I receive payments on a note which has payments due on the 1st of the month. An investor friend who holds a lot of notes claims that the payment is delinquent if not received by the 2nd. He asserts that the 10 day grace period contained in the note only concerns the 5% late fee. So when he has a mortgagor start to develop poor payment habits he has his attorney send a demand letter for past due payment, late fee and it mentions that the next payment must be made on time. So the question is, is my friend correct about the payment being delinquent on the 2nd day? I don't plan to abuse people with this, I normally don't worry about a payment until the 10 days grace period is up.

Michael,
Interesting about the seller requesting that the property be left out of the bankruptcy. This seller told me the same thing! I didn't think people in such bad shape had options!

Thanks Bill,
I haven't closed on it yet. I guess the question boils down to can a property that's in bankruptcy be sold?

I recently bought a title policy on a house that I'm purchasing subject to the exising loan remaining in place. As I was about to close, the seller mentioned that things have been really rough since he declared bankruptcy on 10-17-09. This is not his primary home, he had been using it as a rental. It seems to me that since it's a secured debt, it will be held up in bankruptcy proceedings even though there doesn't appear to be a chapter 13 lien on it as of right now. Any thoughts?

Guys let's get the word out on this FAST. Please alert every investor and realtor that you know. I'm hearing that the only loans being originated are for people with pristine credit reports. This will not unclog the housing market. It will make it much worse until the government once again backs up their buddies at the big banks when they loan to sub-prime customers and then we complete the circle! Does anybody have any ideas to head this off? I'm reading that this will be decided in the next few days.

What's at stake?
-Abolition of property rights
-More government control
-Inability to sell a second home with seller finance
-Loss of ability to buy a property and resell w/spread if it's
not a primary residence.
-Loss of ability to resell with seller finance a note in
your portfolio which defaults.
-Non-performing notes will have to be bought at huge
losses to banks because investors will have to
sell the properties outright rather than getting them
performing and holding them for income.
-Sub-prime borrowers that I hold notes for are improving
their credit scores while building equity. These cus-
tomers will be forced back into rentals.
-This will directly and indirectly affect everybody who
works in real estate. Please get the word out!

I've read a lot of his articles. Has anyone bought the course? Any success stories?

I sell properties and hold the note so I was surprised a couple of days ago when a friend told me that he had closed on the sale of a property but would have to go back the following day to pick up his check. That's not my def. of a closing, that's a signing! Is this happening in other parts of the country? My buddy brings a signed warranty deed to the table and exchanges it for nothing until tomorrow!

Thanks Scott. I'll wear an extra thick shirt so as not to disclose and let my attorney handle it! (the deal, not my third nipple)

There was a discussion a few months ago concerning the likelihood of a lender calling a note because title changed hands.
I'm not concerned about that at this point, I'm concerned about the possibility of any local title company closing a deal when they know that there is a due-on-sale clause in place. How does one get around that? Will I have to get a title opinion and if it's good have the property deeded to me?

Marc,
I'm also buying properties and originating notes. Do you mind sharing your criteria concerning cost basis, markup, interest rate etc.?