Doc needed to purchase private whole loans

5 Replies

Anyone have the docs needed to purchase private party whole loans? These loans are not being purchased through a bank... If not can someone point me in the right direction?

I think I need a Mortgage Note Purchase and Sales Agreement and a Mortgage Assignment Agreement along with my simple assignment contract which I already have... Just looking for the first 2 docs and trying to confirm these are the correct docs needed.

I will be purchasing the loan at a discount and wholesaling it to another investor.

Thanks

Originally posted by @Mona Smith :

"... wholesaling it to another investor."

 If this is happening in CA, I'm pretty sure you are acting as a broker when you acquire notes to resell.  Buying and reselling loans isn't the same as buying and reselling houses.  Tread softly.  If you haven't already, you might want to speak with a mortgage attorney.

Also, escrowing docs and funds tends to put both buyer and seller at ease ... you might want to consider an escrow.

Funds and docs will definitely be escrowed... Just looking for the correct docs to use. I know they are included in many of the note buying courses but I'm not sure which course is best... This is not a normal investing strategy we use as this deal just kind of fell in my lap. We are mainly wholesalers doing fix & flips and buy & holds every 5th property or so... Buying notes is not our forte.

So anyone with access to the correct docs to use in California or a great course to buy... Please help!

Thanks a bunch! :)

Oh and we will just be assigning the docs to another investor for a fee...

This is not a DIY, slap down a template contract and off to the races. There are no template contracts for note sales as terms of sale vary widely.

There are more documents needed than just a PSA. If you do not know what those even are it will be pretty easy to make a mess of things.

Frankly you are headed in that direction, note trades do not generally have earnest money deposits. Assuming you can get by on the end Buyer's due diligence and integrity usually doesn't work to well either.

Unless you are willing to really dig in and gain some competency in loan trades, it's probably a better idea to stick with what you know in real property.

Just to be clear, we are trying to set this up the correct way just as we do all of our deals. We are not fly by night investors nor is it our intention to make a mess of things. This is why I also asked if anyone knew of any good courses so that I may educate myself. Just thought I would ask the question as my attorney is not available until Monday.

Just looking for some info, not a slap on the wrist...

Thank you for your response.

Free eBook from BiggerPockets!

Ultimate Beginner's Guide Book Cover

Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!

  • Actionable advice for getting started,
  • Discover the 10 Most Lucrative Real Estate Niches,
  • Learn how to get started with or without money,
  • Explore Real-Life Strategies for Building Wealth,
  • And a LOT more.

Lock We hate spam just as much as you

Join the Largest Real Estate Investing Community

Basic membership is free, forever.

By signing up, you indicate that you agree to the BiggerPockets Terms & Conditions.