All Forum Posts by: Kevin Moen

@Daniel Dietz would you mind sharing the name of the lender doing a blanket loan at 4.5%?

@Jay Kaltenbach If all you are looking for is 9% - 12% returns, why not invest in note for passive income; or invest in a fund that invests in real estate or notes for a truly passive income? I have done some research of the Birmingham market and the crime is very spotty and a bit high for a passive investment approach in my opinion. I would rather seller finance a house in that market and collect a mortgage payment, vs holding a rental and collect rent...

Joel's example is pretty common for a turn key purchase. If you are able to put sweat equity into a property you can get a much better return than 10%. Also if you learn this business and conduct your own marketing to locate an off market deal, you will boost your chances of finding a strong deal, and increasing your overall return. Getting 25% - 30% for a fixer to refi and hold is not difficult in many market. 

Kevin Moen

I agree with Bob. Low double digit returns are pretty common for a good performing note with a little risk, but low involvement required. Our company also buys and sells notes, feel free to contact us or inbox me if you want to pick my brain on the topic. 

Kevin Moen

I think answering some of the questions Bill proposed would be helpful. There are some confusing statements in your listing. Is the note or sales price $105k? They put $9500 down on the purchase of a property sold for $105k, creating a $95k note? Where's the other $500? I hope their credit is 740+ at that interest rate... 

Like Bill mentioned, the equity belongs to the borrower, not the note investor. Also, how can you offer an inspection of the property, this is the sale of the note, not the property; correct? 

We would make an offer on this if you list: 

Sales Price

Down Payment

Interest Rate

Loan Term

Borrower Credit

Property Address

Number of payments made / pay history

Note originator (Dodd Frank compliant or no?) and current servicer

Kevin Moen

You should be able to beat your mortgage interest rate, unless it is very high, with any respectable investment. Keeping that mortgage allows you to write off the interest and have cash to leverage another purchase, and keep liquid. In my mind this comes down to an opportunity cost calculation. What is your current mortgage rate, and why pay it down vs buy another rental with that cash and with leverage? Are you currently cash flowing on the property after all expenses and vacancy? 

If you decide to buy and hold vs rent with your IRA money, or you roll your IRA over to a Self Directed IRA, I know of a turn key rental provider who allows non recourse lending as a part of their turn key services/package. Might be worth looking into, you could buy 1-2 rentals with $50k - $60k with their program and make double digit returns in your IRA while building equity.

Buying a multifamily rental that cash flows with high leverage (FHA owner occ. 3.5% down loan) and being able to leverage your owner occupied status for a create cash on cash return is one of the best investments I ever made. Just be sure to run your numbers as if it were a rental, if you have strong cash flow after PITI, repair allowance and vacancy, hold that property long term and start building real, inflation adjusted, wealth. Not to mention the tax advantages moving forward, vs capital gains on a flip.

Kevin

We have performing notes available for sale and review about 1000 per month for acquisition. Let me know if this group is interested in a direct source of notes for purchase, or being added to our buyers list.  

@Jay Hinrichs I am curious, with that prickly deal you mention above with credit issues leading to a lien on title, was the CFD recorded? How long had the borrowers been in the property?