All Forum Posts by: Randy Rodenhouse

Most private lenders require note, Mortgage (deed of trust) , Title Insurance and be on the hazard insurance policy at a minimum.  It has been great so far that you have people (friends/relatives) that only are requiring a note but those are the select few.  To answer you question it is relatively easy to get the Deed of Trust filled out and have it recorded.  You can do it or get a title company do it to make sure it is done correctly.  

Not exactly sure what Safeguard does but if they are originating notes for owner occupied properties then they need to follow the Dodd Frank rules and anyone buying such notes should make sure they did. Sounds like they may not be since you mentioned turnkey SFR which is usually a rental property.

In general, the private lender should be secured like a bank would be by getting a note, Mortgage (or deed if trust), Title Insurance and be put in the hazard insurance as mortgagee.  As Harrison said a good real estate attorney or Title company can handle most of these items.

A successful note investor looks at all options and is able to get creative to turn “bad” notes into life long passive income.  

A successful note investor has a focused approach and narrows its market to a handful of states especially when starting in the business.  

A successful note investor is tenacious and does not let any problem or hurdle  get in the way.  

A successful note investor is resourceful and takes the time to get educated...continuously!

Technically, you can do your first 3 without a MLO... BUT you still need to comply with the Dodd Frank laws such as fixed rate for first 5 years, no balloon, checking the "ability to pay", etc.  TN has a limit on interest rate of 7.5%.  Call atty Timothy D. Wardlow in TN and tell him Randy Rodenhouse sent you.

Randy Rodenhouse

IncomeStacker.com

Typically, if you are going to a bank to get the loan they are not going to want to see that the downpayment came from someone other than yourself.  You could work with your friends and family and tell them after closing on house purchase you will put a second lein on the property to secure their interest but they would have to rely on the promissory note to that point.  It does depend on the kind of asset you are buying.

Get a PSA signed by both parties spelling out the price, amount down and terms of the seller finance note and then get a title company to draft up the note and deed of trust and go to closing.  

Ask you seller if he will take a discount on his note and if so go out and find a note investor to buy a discount to face value. Your note is not super attractive since 0% interest but if you owe $33.6k and a note investor buys for say around $20k it may be attractive for note investor and your seller will get $20,000 which is better than nothing if he is in financial hardship. Now you must make sure note investor is willing to modify that loan so as not to have it balloon and you continue to pay a monthly payment until you pay the UPB off under the new term of the loan mod.

I would make sure there is a POC from the last note owner filed in BK court and if you buy you should file a TOC (transfer of claim).  I was not sure if you own note now or looking to buy it.  I would look over the BK plan again and see if it states somewhere that the mortgage payment is made directly to lender or BK court.  

You need to find out more information like how much they owe on the property and the current loan terms so you could possibly buy it subject to or have the seller finance if house is free and clear or a lot of equity.  The key is finding the true value and trying to buy below market value with good terms and then you could turn around and sell on owner financing or lease option and make the spread.