Latest Trend (Mistakes) To Flush Out Uneducated Note Investors

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Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes

OK, I am known to go on rants - but I have been told I add value by keeping it real and letting people know what I see going on in the note space. A recent trend I am seeing is sellers posting notes with a Total Payoff NOT being what the current amount due to the lender to satisfy the loan is, BUT they are taking the total number of remaining payments x the monthly P&I payment.

For example a $100,000 loan that was 6% and $600/month. Lets say it has a UPB of $50k and 150 payments left. The seller will list the total payoff at $75,000 even though the loan is current and the total payoff = UPB which is $50k. DO NOT FALL FOR THIS TRICK. It is an uneducated note investor or an unethical one.

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Andy Mirza

Lender · Ladera Ranch, CA · Member since 2014 · 1k+ posts · 1k+ votes

That's crazy! I would never think of doing that for a loan that I was trying to sell and it would really lower my trust in a seller that was trying to do that to me. Another reminder to not take good relationships for granted and why it's so important for buyers and sellers to treat each other right to develop a good relationship.

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Andy Mirza
Lender · Ladera Ranch, CA · Member since 2014 · 1k+ posts · 1k+ votes
4y
That's crazy! I would never think of doing that for a loan that I was trying to sell and it would really lower my trust in a seller that was trying to do that to me. Another reminder to not take good relationships for granted and why it's so important for buyers and sellers to treat each other right to develop a good relationship.
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Ned CareyPro Member
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Investor · Baltimore, MD · Member since 2008 · 17k+ posts · 13k+ votes
4y
@Chris Seveney I would think that would be blatant fraud.
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Chris SeveneyBusiness Member
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Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
4y
@Ned Carey - Pretty much yes - but there are so many unethical people in real estate and the note space its mind blowing. I had another rant I recently posted on trying to help someone out who was violating SEC regulations and they ignore it and of course come to find out they are "friends" with a well known (well known for the wrong reasons) note investor.
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Ned CareyPro Member
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Investor · Baltimore, MD · Member since 2008 · 17k+ posts · 13k+ votes
4y
@Chris Seveney yes I saw that post too
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