Good Site For Purchasing Notes

29 Replies

Hi All,

I am new to this site and was hoping someone had a good site for purchasing non-performing notes. Any insight is greatly appreciated! Thanks in advance.

I don't know of any sites at the moment but portfolio/asset managers at banks and lending institutions are GREAT to start.

I have used FCI Exchange before but there has to be a better one out there. Thanks.

I don't think portfolio managers at banks and lending institutions are GREAT to start, wtf?

"Hello I'm a new note investor, I have no idea what I'm doing but does your bank have delinquent loans you want to sell me?"

The truth is there is no Amazon for notes, really. If you're looking for something like that FCI is the closest (there are others like LoanMLS but I know nothing about them so I can't recommend them).

We don't know your skill level or your resources. But for a beginner, the best bet imo is to buy from smaller note companies that can do a lot of hand holding, or a reputable broker. That's how I and several others got started. There's a huge difference if you have 25k to deploy than if you have a million.

Smaller companies won't give you the best price, however it's in their best interest to sell you something that you can make money with - otherwise you'll never buy from them again. Considering note buyers aren't a dime a dozen, it's in their best interest to cultivate the relationship and not try to screw you over.

Try to tell us more about yourself and what you're looking for and we might be able to guide you in the right direction.

@Sean Ganey and @Tron Pham

There are several companies which use a website to market loans to the public. Clearly FCI is one of the notable guys. I am curious to hear what you do not like about them or the site or any of the other similar sites/companies. Let's be honest, if simply listing a loan on a website is the primary source of marketing, it sort of is lazy man marketing right? How happy are you when you have a property you need to sell and the agent only markets the property by putting into MLS, no open house, no calls into potential buyers? There are many similarities between those two concepts.

I will agree with Patrick, you will not likely get too many trades done through banks. Frankly, and I know this get's passed around much by folks, but banks are some of the hardest places to get trades done in the market. They often (very) are over priced. They have the cheapest capital on the street so they can wait out the storm for a very long time. Most small and regional banks care more for their commercial non-accruals than they do about their residential non-accruals since those have a larger impact on their balance sheet.

Like I said, I am pretty interested to hear what you are not fond of and why. I think it is a good discussion topic for some other newbie note investors who stumble past the thread. I personally have my own reservations (for each player in the market), which I will share if we can get a couple other responses.

From what I have seen on the FCI site al lot of the NP notes look over priced and/or look like they have been worked without success.

@Sean Ganey

I would recommend going to some of the Note related events for networking with note sellers.

Some of the more notable events are:

Papersource - Vegas - Around April/May annually

Noteworthy - Vegas and Dallas - April and October annually.

Of the two, I like Papersource a lot more. The content and networking is much better, and there is zero pitching.

I found Noteworthy to be a cut-throat pitchfest, with some tiny nuggets sprinkled in to reel you into the back table with your credit card in hand.

I've had some success with FCIExchange. The nice thing is that once you have an accepted offer, you can dialog with the seller via a chat window and request the collateral docs for review before you finalize your price. Also FCI escrows your funds and requires you to review and approve the final collateral files before they pay the seller. I also agree with Sean, go to the events and make contact with the hedge fund reps who attend, you can then get on their lists

Originally posted by @Jesse Tsai :

Some of the more notable events are:

I see what you did there.

I am new as well.  I have bought a couple of non-performing notes and strangely enough they were both from banks at insane discounts.  Now that was 8 years ago and I am only now getting back into this.  At the time I was fix and flipping.  When the market crashed I just watched from the sidelines until my flip finally sold 2 years ago and I am carrying the paper.

I know what you mean about FCI, many non-performing firsts were offered at face value of the loan balance. Hello? Of what possible use is that?  I am going to try the small local banks first.  Test the water so to speak.

I plan to research smaller funds if that does not work.

Keep in mine FCI is not the one listing the notes. They are just facilitating the seller to post their notes and the buyer to purchase the note, so if the notes are over priced it's on the seller's side overpricing their notes. There are some really good deals on there too, and you can always put in an indicative bid less than lets say a seller who is selling their NPN at 100% of the asking price.

Also PPRNote co. ran by David Van Horn sells notes.  They have a little bit of a premium on them too, but might be good on a one-off basis. 

I do believe Gerald Lemoine sells them too?  I could be wrong on this one though. 

Try getting some education on the subject or learning from some savvy note investors like Scott Carson "We close notes". Also, I've purchased notes from DBI and Watermark Exchange.... There are plenty out there!

I second a vote for PPR, Dave Horn is active on BP and runs an ethical business from what I've seen. There are also groups on LinkedIn. I'm on a list from there for performing notes and successfully purchased from one of the members.

Where to buy notes?

Good point Miki! You bought one from a holder, not a broker (?)

If note folks would learn how to find notes, you probably couldn't buy all the notes that would be available to you in a 50 mile radius of your front door!

I have no "issues" with those buying from brokers, they need to eat too, or out of group pyramid schemes (if you're on the top side of the chains), but buying from the note holder will be your best pricing, easier due diligence with individual note holders and therefore, less risks.

Best site to look at is probably your county courthouse Recorder of Deeds Office! :)

Bill excellent point.  As a new note buyer I  will be researching deeds at the courthouse.   Many of us are willing to put forth the effort if we had a direction to focus so thank you.  I suspect watching the legal notices for non bank filings would work to find non-performing notes.

.  I am joining linked in and will be checking out PPR, DBI and watermark.  Excellent advice  Dion, Bob, Arthur, Sheryl, Micki and Bill.

You can search deeds of trust, (mortgages) the named grantee will tell you if it's an institution or an individual or small LLC type. You'll get more frustrated note holders looking back 12 to 36 months ago, not at new notes as that is simply lending without seasoning. There can also be some issues buying new notes at settlement or thereafter as you may still be "funding at the table" which is a lending function, not a note investing matter.

Brokers can be dumping institutional trash, individual note holders sell because they need the money usually, complete different motivation and motivation is an underlying factor of the discount.  :)

@Bill G.   Thanks.  That helps quite a bit.

Does anyone have any experience, good or bad, purchasing through DebtX? $500 "vetting" fee for the initial sign up and then again annually.

It looks like they have access to FDIC loans. www.debtx.com

Two sites very worthy.
Mortgage float.com
Nationalnotegroup.com

Just looked at National Note Group.  Not my cup of tea.  they are mostly selling 2nd liens with no equity.

Originally posted by @Bill Gulley :

You can search deeds of trust, (mortgages) the named grantee will tell you if it's an institution or an individual or small LLC type. You'll get more frustrated note holders looking back 12 to 36 months ago, not at new notes as that is simply lending without seasoning. There can also be some issues buying new notes at settlement or thereafter as you may still be "funding at the table" which is a lending function, not a note investing matter.

Brokers can be dumping institutional trash, individual note holders sell because they need the money usually, complete different motivation and motivation is an underlying factor of the discount.  :)

If you go the courthouse search route, you are basically going a cold call route right? You just see if an individual or LLC is willing to sell after you hunt down their contact information? Would information on whether or not it is performing also be included there?

Yes Steve, you're fishing, but it's a big lake, I assure you there are note-fish in there.

If you want non-performing you might look at foreclosure notices.

Yes, the status of the loan is discovered in your contact with the note holder and your due diligence. :)

Originally posted by @Sheryl Griffin :

Try getting some education on the subject or learning from some savvy note investors like Scott Carson "We close notes". Also, I've purchased notes from DBI and Watermark Exchange.... There are plenty out there!

I'm familiar PPR & Watermark, however who are DBI?  Thanks

This post has been removed.

Create Lasting Wealth Through Real Estate

Join the millions of people achieving financial freedom through the power of real estate investing

Start here