All Forum Posts by: Patrick Desjardins

 If the seller agrees to pay them then I don't think asking for a discount is relevant.

On the other hand if they weren't going to pay them then you would subtract some or all of them from the purchase price.

You should strive for a win-win scenario, not to take advantage of the seller. Just my opinion.

Notes are for anyone with a bit of savings, including you. You just need to have reasonable expectations and buy them.

As I mentioned, find a seller other than the exchanges. You will find notes where the home is owner occupied or 2nds with partial equity. You just will.

My friend ONLY wanted to buy 2nds where the 2nd is covered in equity. It was in the middle of the recession and he still found some even though it's one of the rarest category of notes, like a unicorn. Not many, but he found some. You definitively can too.

Hey Jeff,

Your experience seems pretty common with the new note investors I've met in the past year or two. There are many hurdles that you need to get past one by one, the first of which is finding notes but more importantly pull the trigger and buy the damn thing.

One recurring problem I've noticed is new investors telling me they can't find deals - but when you show them deals they don't buy anyway because they always think the notes are no good.

Little rant here: I put up some notes for sale on the exchanges to try it out and it's been a pretty big disappointment so far for this very reason. The buyers have no idea what they're looking for and just waste your time. I went above and beyond by providing literally everything including due diligence material that no other seller would provide for a 2nd mortgage (ie BPO, Sr lien payoff statement, on top of the usual credit report etc). And they still can't pull the trigger.

"all of the obvious prime investment opportunities are going to be gone"

This is complete horse crap. I've found way more note deals in the past month or two than I have money to buy and I don't have a fund.

Sorry I don't mean to be harsh it has just been irritating me lately. Stop looking for the perfect note; you're not going to find it and if you do, someone with more experience / faster due diligence will scoop it.

So my advice: Find one note seller outside of the exchanges, see what they have and buy one note. Improve from there.The truth is when you're new you only need ONE source of notes. What good is it to you to look at 1,000 notes if you can't pull the trigger and buy ONE?

Edit: I see we're already connected. Find a note that looks like you would pull the trigger and send me a message, I'll look at it and see if I notice anything suspicious.

 They're an introduction to note investing. It's not going to make you a master at buying notes or anything but if you're brand new it can't hurt.

The mentorship program was great but they closed it. 

They're having a conference call soon where you can call in and ask questions.

These numbers aren't representative of what people here should expect, on multiple levels.

1) Most product sold to retail investors is in the sub 125k range, which is much cheaper.

2) Those pools are for hundreds / thousands of loans while the retail investor will pay more for his 1-5 purchase.

So this data literally has zero impact if you're buying the note on a 60k condo in FL or a 40k house in Ohio. Keep that in mind. But please do bid 75%+ on my notes, that would be greatly appreciated :)

The returns and cash flow, obviously.

If you're buying foreclosure sales you're looking at inventory where the 1st mortgage is being foreclosed, which retail buyers of 2nd mortgages try to avoid for the exact reason you mentioned - they would get wiped. 

So your question is based on the wrong premise. People buying 2nds where the 1st is in foreclosure typically do so as part of large pools of notes and their return is calculated on the entire pool, not a single note getting wiped out.

As the others mentioned, you have zero "equity in the house", but your note has a ton of equity (basically the FMV minus your Unpaid Principal Balance).

Your question doesn't make a ton of sense because it's not clear what you really want to know. Are you trying to figure out how much you'd gain if you foreclose, or how much equity protects your note?

You're entitled to the full UPB plus advances plus costs, so in that example if the house is worth 200k+ and your UPB is 100k then you're pretty much guaranteed to recoup the full amount.

Post in the marketplace, with all the info on them.

Thanks for the reply. Just a quick precision that I'm referring to trustee auction and not tax sale. We own the 1st mortgage and taxes are current.

Hey guys,

How active are the Memphis trustee auctions?

We own a loan nearing foreclosure and it's set to go for trustee sale in December. 

I'm torn between trying to liquidate it at the sale or keep it as a rental. It doesn't seem like it's in a complete war zone so it might make for good long term cash flowing asset, however we don't have a team there yet so dumping it at the sale would be much simpler.

Thanks in advance for the information.