All Forum Posts by: Tim Fitzgerald

I've been at this for almost 20 years, and from my vantage point note brokering is alive and well-- call it what you will, but brokering is really what I'm referencing as opposed to "wholesaling" which would suggest you are taking title to a loan and then reselling which, if done incorrectly, can absolutely run you afoul of securities laws. Whereas brokering does NOT involve taking title to a note-- you are simply REFERRING a note to a buyer and I recommend that you deal only with CORPORATE (institutional) buyers of which there are quite a few. People seem to speak highly of Papersource (Bill Mencarow), for example-- you might start with his "Registry of Note Investors" if you are seeking funding sources.

I see some comments on this forum that suggest note brokering is [some outdated idea from the '80s that is the domain of pitchmen and gurus] and I beg to differ. That's not the case at all. All sorts of notes are being transacted and this involves many different scenarios (brokering and direct investing)

Also, it seems to me there is quite a bit of misinformation being thrown about here with respect to Dodd-Frank. Contrary to some of the stances being put forth here on this board, it really hasn't affected the note business very much for practical purposes although it could have under its originally-proposed form but a seller finance "coalition" led by Ric Thorn and which I believe Bill Mencarow was also a key part of got the original bill changed before it became law. Had they not intervened, it WOULD have killed seller financing but that didn't happen.

Now, granted, I normally focus on privately-held seller financed notes so that's my area.

If you're looking to "wholesale", i would say you'd better be careful. There are, however, proper ways to go about REFERRING notes for which corporate funders pay finder's fees.

So, NO, brokering notes is NOT dead-- it's very much alive AND it's a great way to generate income (and this is what we mean when we say "other people's money").

To the best of my knowledge, Dodd-Frank does not apply to the vast majority of private note sellers that I target which are typically "one timers". Although the landscape is expanding and there are other entities you can work with as well who are more sophisticated and do multiple note transactions per year (create and sell off) but that's a different animal and usually they'll only work with buyers (or in some cases brokers) that they know well. That said, "brokerage" can encompass kind of a wide array of scenarios-- some funders may not always be using all of their own money for purchases-- they may go to outside sources sometimes and there may well be a referral agent in there somewhere. There are many interrelationships.

So, to say that note "brokering" is somehow [a tired old idea from the 80's] is just plain wrong. Let's not confuse brokering with wholesaling (which I would not touch).

According to Bill Mencarow, who many of you seem to like (and I can say that Bill has been around for a looong time- I've attended his  Paper Source conventions going back to the 1990's), Dodd- Frank does NOT apply to note brokerage. It only applies in SOME cases if you create or invest in notes and even then, it really isn't much of a issue unless you do not take the time to look into it.

I'm not sure if I can post an outside link here or not (I'm kind of a late-comer to this forum but I'm really glad to be here) but I'd be happy to post a link to Ric Thorn's full article on Dodd Frank and exactly how it affects the note business.

For that matter, if anybody wants to know more about BROKERING notes, I have a ton of free information about it that I'd be happy to send to you by email which is the best, most efficient way for me to send it.

If that might prompt someone to suggest that I'm [trying to take the conversation off line or something], I would say, hey, how much can I really post here on one comment box?

Anyway, let me know if you're interested and I'll shoot the info to you by email and I'm also right here on this forum to answer any questions that you may have that I know the answer to!

GLAD TO BE HERE and this is a very intelligent forum--wish I had come in sooner but better late than never.

LLC provides for pass-through tax treatment, which, for me, is a huge plus.

I've been at this a while (almost 20 years) and I would say that, without reviewing that program (which I am not familiar with), $4,500 profit on the low side, if he's claiming that to be the average) may or may not be so but there are many cases where you'll make less (I've done small transactions that netted around $2,500 on the low side) and also many where you'll make more than that ($7,000 and up is not uncommon) -- it depends on the outstanding balance of the note, LTV and a host of other factors.

Re "wholesaling", be wary of "daisy chains" where would-be brokers try and pass themselves off as end buyers. 

I've been investing in performing notes (usually privately-held) for almost 20 years now, and I have to tell you that marketing and networking with financial professionals is really where the repeat business is at. I do have quite a few writings about this that you may find helpful. If you'd like, PM or email me and I'd be happy to send you what I have.