Buying Note from Banks

Hi,
Does anybody have any information regarding Buying Notes from the Bank? If yes, which Department would I be speaking to? What is the process & at what percentage can I purchase the existing note?
Thank you!
Toni :cool:

Ryan Pal

Real Estate Investor · New Jersey

3 posts
50 influence

Oct 24 '11, 06:25 PM

Hi Toni,

You want to ask for any of the following:

Toxic Assets department
Secondary of Marketing Department
REO department
Crisis Desk

Colbert Saint-Laurent

Rehabber · Long Island, New York

14 posts
1 award
50 influence

Oct 24 '11, 07:20 PM

Toni,

Loss mitigation department, Special Assets department, you can also ask to speak to the Asset manager. Or who ever takes care of the Performing or non perfoming FIRST position Loans. Usually They will send you a sanitized list (no adresses) and if you are interested they will ask for a LOI and a proof of fund, then you can submit your offer. NPN typically 40% of the upb or PN 60% of upb.[REMOVED] hope i could help.

Edited: 10/24/2011 at 07:51PM by Administrator : Solicitation removed

Ali Shah

Real Estate Investor · Las Vegas, Nevada

126 posts
1 award
50 influence

Nov 02 '11, 12:07 AM

Toni,

those departments will be for your smaller, local community banks. Prices vary based on location and product itself. Larger banks dont sale to smaller investors like me and you unless you have really deep deep pocket and can cut a check on the spot for $50 mil plus, given the fact you have bought from them before and have inside connection and a solid resume of note buying.

Now these days the community banks in trouble have either been shut down or their balance sheets have gotten stronger, if they sale NPN's their pricing may be ridiculous.

Dion DePaoli

Note Investor · Fort Lauderdale, Florida

Pro Basic

245 posts
1 award
58 influence

Nov 12 '11, 02:29 PM

Toni,

Typically small regional and community banks service their mortgages in house. From time to time they may contract with a servicing company. Contacting the Loss Mitigation Department of that servicer is a place to start but most servicers are not built to run those inquiries well. Speaking with a bank's asset manager who has control over their special assets division which is just another name for the "loans that don't pay well" is always going to get you into conversation a little quicker than trying to navigate the larger servicing platforms.

Regarding pricing. It is relevant. I see people try and describe price expectations all the time and they are not good generalizations but that is about it. The discount that a seller is willing to take can be identified as a percent of the balance of the loan (UPB) or the value of the real property via appraisals or broker price opinions (BPO). It seems many people interchange these concepts for good talking points.

When you see percentages that are low like in the 30% or less that is not likely based on the real property value. No one is that silly. No note owner is going to take a deep loss for you.

Typically what you will see related to say non-performing loans, as you get closer in the foreclosure timeline your offer or bid as it relates to the current real property value will need to be higher. Each state is a little different with the time and process to get through the process of foreclosure and it really becomes a matter of time value of money to the note owner. In most cases with a little foreclosure timeline left you can purchase the loan for something in the mid 60% of the current market value.

It is also important to note, that two people may view the property value different. So if I say the property is worth $100 and we say 65% that is different than you saying its $90 and paying 65%. At the end of the day, the real base of communication is the dollars you wish to spend. The same disconnect occurs when talking percent based on UPB, where if I told you I wanted 90% of UPB you might think I am crazy and that is too much, but if the property has say 50% equity the story is a little different.