Would you invest in Bankruptcy Judgement?
Lender · South Florida · Member since 2018 · 94 posts · 14 votes
previous experience of bankruptcy judgement deal that you did.
Warren Buffet has had a good strategy...invest in what you know.
One thing to consider is that you are dealing with someone who didn't pay their bills and take care of business in the first place. So how easy will it be to recover the judgement with someone like this? Do you have the legal skills to enforce the judgement? If not the legal skills, the persuasion skills to talk them into doing something they don't want to do.
Let's just say they have a Rolls worth $100k, and you got a judgement for $10,000 against them, but they have the keys and it is in their garage. You may have the right to take it, but you have to catch them out driving around, you probably can't snatch it legally from the garage. They know that. So you have to talk them into giving it to you. Maybe that costs you another $10,000 cash, so you don't steal it when they're out with their date at a night club with no way to get home. Maybe you trade them for a $50,000 Ferrari, so they're still riding in style and you're $40,000 ahead. Is that you? Are you a creative thinker and a persuasive talker?
One of my attorney's told me the same think. I wanted to buy a 25% undivided interest in a parking lot in major metropolitan area...25% family member is tired of dealing with the other 75% of the family so wants to sell. Great deal on paper. So attorney advises me....what do you know about buying undivided interests? What do you know about the family? If this guy can't deal with the family, how will they deal with you? and lays out about 10 more ways I might not be happy with this "deal". He's probably right....may be easier ways to make money...plenty of opportunities out there.
Warren Buffet has had a good strategy...invest in what you know.
One thing to consider is that you are dealing with someone who didn't pay their bills and take care of business in the first place. So how easy will it be to recover the judgement with someone like this? Do you have the legal skills to enforce the judgement? If not the legal skills, the persuasion skills to talk them into doing something they don't want to do.
Let's just say they have a Rolls worth $100k, and you got a judgement for $10,000 against them, but they have the keys and it is in their garage. You may have the right to take it, but you have to catch them out driving around, you probably can't snatch it legally from the garage. They know that. So you have to talk them into giving it to you. Maybe that costs you another $10,000 cash, so you don't steal it when they're out with their date at a night club with no way to get home. Maybe you trade them for a $50,000 Ferrari, so they're still riding in style and you're $40,000 ahead. Is that you? Are you a creative thinker and a persuasive talker?
One of my attorney's told me the same think. I wanted to buy a 25% undivided interest in a parking lot in major metropolitan area...25% family member is tired of dealing with the other 75% of the family so wants to sell. Great deal on paper. So attorney advises me....what do you know about buying undivided interests? What do you know about the family? If this guy can't deal with the family, how will they deal with you? and lays out about 10 more ways I might not be happy with this "deal". He's probably right....may be easier ways to make money...plenty of opportunities out there.
Great point Bruse, wondering if pursuing judgement only secure by real estate is a better option