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Tax Liens & Mortgage Notes

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Pari Thiagasundaram
Pro Member
  • Lender
  • Fremont, CA
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Is this note worth buying ?

Pari Thiagasundaram
Pro Member
  • Lender
  • Fremont, CA
Posted Sep 15 2015, 22:40

I am trying to get my feet wet on the note business. Here is something that i offered and the seller accepted my offer. (Have one last chance to backout if need be).

UPB: $8226.36

Monthly payment: $596.50

Remaining number of months: 14

BPO: Approx $900K

Note rate 5%

Maturity date: 12/10/2016

30 year Note originated in 1987 !!!

Offering: $5800.00

Servicing fee: $85/month ($1190 for 14 months)

Rate of return : 21% ?

((8226-5800-1190)/5800)*100 = 21%.

Am I calculating it correctly ?

Are there any other costs involved when the buyer pays off the loan?

One more thing i noticed in the due diligence package is that, there is an affidavit of lost note. Should this be a concern ?

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