Selling an NPN to avoid taking ownership

[Sean Dezoysa]

I am interested in NPNs up to the point of having to take ownership because my goal is to avoid the additional burders of remote hard asset management. So for an investor like me, I have 2 concerns:

1) Will it be easy or fairly hard to find another investor to take over the NPN that is headed to foreclosure?

2) Not being local, but having a team in place, does it make more sense to sell the note preforeclosure, or post foreclosure? I suspect the former incurs less costs but the later may be an easier sell to an investor crowd.

Thanks for any advice

[Mike Hartzog]

I try to avoid REOs.  My experience is that there are no good surprises to be found in the inside of these properties.  You can sell pre-foreclosure to simply get out to recover your invested capital.  One good exit in foreclosure is to create a situation where the asset sells as the sheriffs sale.  If you have a good equity position you can set the opening bid at a level that returns your investment plus a profit and still leave room for an investor to pick it up at the sale at a good price.  If the market is active, you can do well.  Has to be a decent asset which is not in a high crime area etc.  local investors are better equipped to deal with these anyway.