non performing notes - what does a buyer need

I just received about 5 non performing notes for sale - they are in the higher $ range. The seller wants the buyer to provide a proof of funds before they are even allowed to get info on the note to complete their due diligence. What would the buyer need so if they wanted to buy the note they would have enough info to do so? These notes are bank owned and are being offered at 50% LTV.

Thanks,
Nancy

Edited: 06/26/2010 at 09:27AM

Marc Faulkner

Note Investor · Kalamazoo, Michigan

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Aug 23 '09, 09:58 AM

I think the sellers must be crazy asking for anything other than help selling in this BUYERS market. Why would a buyer provide proof of funds or a Letter of Intent to get a look at something they might not even want? Real buyers don't have the time for this.

Edited: 06/26/2010 at 09:27AM

Will Barnard

Rehabber · Santa Clarita, California

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Aug 23 '09, 10:17 AM

Here i sthe jist of things as I see it. Sellers asking for POF"s, or anything else for that matter BEFORE a buyer has opportunity to view any details happens only when a middle man or too many middle men are present or are not real sellers. Otherwise, if you are a true seller, what is the harm and effort involved in giving details of a property or note before seeing a POF?

If anyone can answer that question reasonably, I (and many others) are all ears!

Edited: 06/26/2010 at 09:28AM

Will Barnard, Barnard Enterprises, Inc.
E-Mail: info@barnardenterprises.com
Website: http://www.barnardenterprises.com
info@barnardenterprises.com

Alice Chicken

Real Estate Investor · LI, New York

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Sep 25 '09, 08:16 PM

I have been fortunate to sell a few tapes recently.

The reason that i ask for true POF from bank such as bank statement is because i have quite a few buyers stating that they have funds. Yet, when they say that they want the properties, and i ask for POF, i have a lot of stories and a lot of papertrails.

I make it a standard for myself that if it is less than $50 millions, I will ask them to give us the true bank letter with bank signature that they have the fund available.

This helps me narrow down the right true buyers and the lookers, and most of all, it saves me a lot of time.

Edited: 06/26/2010 at 09:50AM

Alice Chicken

Real Estate Investor · LI, New York

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Sep 25 '09, 08:17 PM

Sorry..second paragrah.

MORE THAN $50 millions, ask for true bank letter with bank signature

Edited: 06/26/2010 at 09:50AM

Laurence Hicks

Developer · Los Angles, California

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Oct 06 '09, 04:19 AM

We sold more than few notes to our personal clients we never ask for POF. A question i would ask you is if you have close a NPL ? I have no problem with giving out NPL to my clients but we don't have brokers in the middle.

Edited: 06/26/2010 at 09:57AM

Reverend Corey

Real Estate Investor · Tampa, Florida

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Dec 23 '09, 07:37 AM

Marc,

If you wanted to sell me something would you not like to know before you contract with me I can fund for said assets?

It's just like the bank they want you to have your pof ready as well before they let you see any real discounted inventory!

Edited: 06/26/2010 at 10:57AM

Marc Faulkner

Note Investor · Kalamazoo, Michigan

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Dec 27 '09, 11:29 AM

Reverend Corey, I have been trading notes and loan portfolios since 1999 and have not had to show proof of funds until an offer was made and most of the time this hasn't been required at all. Why would anyone want to jump through hoops to see something they don't even know they will want?
When I want to sell something I try to get the word out to as many potential buyers as possible. You would be amazed at how resourceful some buyers can be in finding capital when they see value! Some of my best buyers use borrowed money or lines of credit to buy notes. If the deal qualifies, the buyer qualifies in some cases. With that said I wouldn't just go throwing out sensitive information regarding notes or available loan portfolios on the open internet or to anyone I don't have a relationship with.

Edited: 06/26/2010 at 10:59AM by Marc Faulkner

Al Cucuk

Residential Real Estate Agent · port st lucie , Florida

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Jan 09 '10, 07:03 AM

We have been buying npn from institutions/banks they always ask for non disclosure agreement because of the borrowers info confidential.
POF goes along with the first offer, once relationship established they will not ask again. we closed 90+ npns in 2009. same protocol for every DIRECT SELLER.

Edited: 06/26/2010 at 11:10AM

Bryan Silver

Real Estate Consultant · Seattle, Washington

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Jan 13 '10, 08:36 AM

OP...most important info needed to perform DD is address, ubp/asking price, & BPO/appraised value.

Int rate; pmnt amnt; date paid; & maturity are secondary.

Edited: 06/26/2010 at 11:12AM by Bryan Silver

Bill Gulley

Real Estate Investor · Springfield, Missouri

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Jan 13 '10, 09:01 AM

Hi, first let's back up. A bank is selling mortgage notes to the public? Unless they have consent of the borrower, tell me this ain't so! They don't want tire kickers, but I think they are getting their marketing philoshy mixed up with REO/ORE marketing, it's not the sam thing.

Then, tell them in a cover letter with your letter of intent, that in order to meet your portfolio requirements that you need to evaluate loan performance for the following analysis.

Weighted average yield to maturity
Weighted average return at par
Weighted average collateral to discounts
Loan loss reserves to capital
Doubtful accounts and collections expenses

This analysis is required in order to meet our portfolio goals as well as to submit any bid for the classified loans offered.

See what that gets! Bill

Edited: 06/26/2010 at 11:12AM by Bill Gulley

Jim Wineinger

Real Estate Investor · ten mile, Tennessee

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Jan 25 '10, 01:58 PM

Originally posted by Reverend Corey

Marc,

If you wanted to sell me something would you not like to know before you contract with me I can fund for said assets?

It's just like the bank they want you to have your pof ready as well before they let you see any real discounted inventory!

That is like a car dealer saying I have discounted cars available, but before you get to see them, I must see your cash.
Too often these portfolio of cars will be the ones that have already been compacted.

Edited: 06/26/2010 at 11:22AM

Ty Kirkpatrick

Real Estate Investor · Cicero, Indiana

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Jan 26 '10, 02:10 PM

I find it very interesting the way this market has turned recently. I have been in the real estate game since I was 19 years old and I have seen many changes, not necessarily for the better. [SOLICITATION REMOVED]

Edited: 09/23/2010 at 04:38AM by Moderator : no solicitations in discussion forum, please

Daniel Garcia

Rehabber · Van Nuys, California

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Feb 07 '10, 01:01 PM

I am in the same situation at Ty. [SOLICITATION REMOVED]

Edited: 09/23/2010 at 04:39AM by Moderator : no solicitations in discussion forum, please

Jim Wineinger

Real Estate Investor · ten mile, Tennessee

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Feb 07 '10, 02:55 PM

If you are truly interested and a direct buyer then you already know about this legitimate site.

http://www.fdic.gov/buying/loan/loansales/index.html

Edited: 06/26/2010 at 11:33AM

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Eli Chambers

Real Estate Investor · Jacksonville, Florida

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Mar 25 '11, 01:42 PM

I just got connected to the vp of a firm handling commercial performing & npn's as well as commercial properties. Over $6B on their spreadsheets. Shoot me an email & I'll connect you. greaternumber@gmail.com

Eli Chambers

Real Estate Investor · Jacksonville, Florida

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Mar 25 '11, 01:43 PM

I just got connected to the vp of a firm handling commercial performing & npn's as well as commercial properties for 9 banks in the southeast but they have inventory all over. Over $6B on their spreadsheets. Shoot me an email & I'll connect you. greaternumber@gmail.com