143: Your First Note Investing Deal

Note MBA

Your first note investing deal can be daunting as hell. Have you gotten yourself set up with all the right vendors? Have you fully research things like foreclosure timelines in the market you're investing in? How long did they say the service transfer was going to take? Wait, what's a service transfer? All of these - and admittedly many more - are important questions to review as you start note investing. During today's show David breaks down some items currently going on with his first note investing deal.

Your First Note Investing Deal

So, David can now finally answer the question, "What was your first note deal?" It's a 3 bedroom, 2 bath in Ottawa, Kansas. Right off the bat this is an interesting deal to look at because certain parameters. Most notably is the small population of just under 13k. Most of the time I like to see over 35k, but it might've been due to familiarity with the area or it was just a steal of a deal. It'll be something I'll follow up with on a future call for sure.

Another interesting twist early in the game on this asset is that the borrower is deceased. So, the first order of business - aside from getting the service transfer done and getting docs in order - is to TLO an possible next of kin. TLO is a service you can use in your business to obtain important information about your borrowers.

They've also dealt with some assignment of mortgage issues on the file thus far.

Note Investing In Equity Deals

This past week we had another swing and a miss on potentially buying a pool of loans. This time around the reason we couldn't purchase was due to huge equity deals in the pool. Originally we thought we'd be the ones nixing the deal due to being uncomfortable with the level of equity in the pool. However, it turned out that the seller just wanted too much for the deals.

One of the major reasons people recommend that avoid deals with equity, or at least substantial equity, is because the pricing on that loan is going to be higher. Also, you tend to encounter whole exit strategies being taken out of the equation.

So, the general rule of thumb is to avoid them in the beginning to avoid higher pricing and getting yourself hamstrung into an exit strategy you didn't want to take, or it being the only one you an take.

That’s it for this week! Thanks for listening everyone and as always, if you have any questions, comments or potential deals to send our way, email us at [e-mail].

Listen & Watch this Week’s Show to Learn:

• A Major Bank Once Again Offering Zero Down Mortgages
• Brief Note Expo Recap, More To Come
• Note Investing In Equity Deals
• Deficiency Judgements in Kentucky
• Robby Has A Loan Mod Mediation, Can't Wait To Hear About It
• And much more!

Featured on the Show:

• Note Investing Academy
• Zero Down Mortgages
• Big Live Success Business Event
• Note MBA Facebook Page
• Due Diligence Pro
• Hardwiring Happiness

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Thanks for listening to our show! We’ll be back next Wednesday morning.

Cheers,

Chase & Robby