Due On Sale Clause About to Become More Common?

Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes

We haven't seen that many due on sale clauses being enforced by lenders over the past decade or so. At the same time, we're seeing some gurus selling strategies like subto as if there is no risk of triggering a DOSC. More and more investors are looking to assume low-interest loans rather than deal with reduced cashflow thanks to today's interest rates. It was before my time, but my understanding is that triggering a DOSC was more common in the 80's during a similar rising interest rate environment like we find ourselves in now. Lenders are probably more likely to enforce their right to call the loan if they feel their security is at risk in the hands of an unvetted buyer, or they believe they can make more money if the buyer applies for a new loan. It seems like it is becoming good business for lenders to start enforcing (they may actually also benefit by getting these 2-3% interest loans off their books). Are we about to see an uptick in due on sale clause enforcement? Curious to hear what some lenders and folks who have been around a minute think about this...

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Pace Jordan MorbyPro Member

Investor · Tempe, AZ · Member since 2016 · 20 posts · 50 votes

We have had the due on sale clause called 4 times this month... but knowing your way around it is crucial. Either A: revert to a lease option with the option price being the mortgage balance when the option is executed... or B: Use an executory contract instead of SubTo. Land Contract. Contract for Deed. Agreement for Sale etc. I talk about this on my youtube channel.

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Tom GimerBusiness Member
DMV · Member since 2017 · 3k+ posts · 3k+ votes
3y
Quote from @Account Closed:

@David M. I got permission from the loan officer that issued the mortgage. The mortgage was and still is held by the same bank. It was an email response. So yes, in writing.

I don’t doubt that occurred but a loan officer cannot make that decision and bind the lender with an email. The loan can still be accelerated.
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David M.
Morris County, NJ · Member since 2020 · 5k+ posts · 2k+ votes
3y
@Account Closed
Yeah, I'm not so sure about the loan officer, whose function is really to be a salesperson, really being able to give you an answer. Also, are you really sure the Note wasn't sold off --- you can take that to be rhetorical... I guess you are sure you got a portfolio loan and worked with some small bank... Even some to many nonconforming loans have a secondary market. Anyway, good luck.
1 Reply
Joel OwensBusiness Member
Moderator
Real Estate Broker · Canton, GA · Member since 2010 · 15k+ posts · 11k+ votes
3y
Some people in it longer than me I have been in real estate about 20 years now.
I looked at tons of strategies residential and commercial. Went to commercial and never looked back.
I like vanilla deals. I learned long ago the more complex something is the more things can go wrong.
Decades ago people were chasing the first easy million and the same seems to ring true today. People just need to accept it's smart work, timing, etc. to make millions, tens of millions ( no magic pill). Investors making tons of money do not need to sell people anything. Why in the world would I want a 1,000 people I have to mentor that have no clue what they are doing for say 5k a pop. It's 5 million gross before expenses and then you have endless calls and taking your time.
I have a news flash for everyone. Money can be infinite but time is not. 48 years old now. Making the next million is nice but doesn't motivate me to log long hours. You get so much wealth and start getting older you enjoy the business but focus on quality of life more and memories.
Due on sale if the lender calls it the cost of capital for lenders now is much higher than in the past so they would not make that much relending the money out. If a bank has to pay out 5% to get deposits then they usually want 7% to lend back out or it's not worth their time.
People need to quit chasing the quick buck with a promise of fast wealth. That's a house of cards ready to fall down fast.
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Account Closed
Rental Property Investor · Indianapolis, IN · Member since 2020 · 562 posts · 554 votes
3y
@David M. I am sure the note hasn’t been sold off, but thanks for asking.
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Steve Duff
Investor · Florida Panhandle · Member since 2020 · 10 posts · 3 votes
3y
Quote from @Steve K.:

Topical considering tonights events, eh? Gurus will have to switch to a new snake oil.

What events are you referring to please?
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Steve K.
OP
Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes
3y
Quote from @Steve Duff:

Quote from @Steve K.:

Topical considering tonights events, eh? Gurus will have to switch to a new snake oil.

What events are you referring to please?
There was a slew of virtual assistants/ bots/ spammers creating new profile accounts and posting commercials in the forums for a guru who teaches creative financing especially subject to strategies on Friday night. The moderators have since cleaned it up. Thanks mods!
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Account Closed
Investor · Phoenix, AZ · Member since 2018 · 420 posts · 388 votes
3y
I don’t know a single lender that wants to bear the expense of foreclosing on a performing asset. They aren’t losing money on those loans, their spread is still intact. What would be their motivation to risk driving someone into foreclosure that’s been paying their note like clockwork? Can you imagine the PR nightmare they’d face in this digital age? Just because it’s legal doesn’t make it popular in the court of public opinion. And believe me, banks care more about PR than a celebrity on at a movie premiere.
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Steve K.
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Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes
3y
Quote from @Account Closed:

I don’t know a single lender that wants to bear the expense of foreclosing on a performing asset. They aren’t losing money on those loans, their spread is still intact. What would be their motivation to risk driving someone into foreclosure that’s been paying their note like clockwork? Can you imagine the PR nightmare they’d face in this digital age? Just because it’s legal doesn’t make it popular in the court of public opinion. And believe me, banks care more about PR than a celebrity on at a movie premiere.

My understanding is that banks did start enforcing DOS clauses the last time we were in a similar rising interest rate environment. Any thoughts on why it made sense for them to do so then but not now? After all what is the point of banks having DOS clauses in their contracts if they never plan to enforce them? My understanding is that the Garn-St. Germain act of 1982 was passed because too many people were assuming loans, and banks were worried about their increased risk of these loans going into default. Couldn't that become the case again now, if subto becomes a more widely-adopted strategy?
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Steve K.
OP
Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes
3y
Quote from @Steve K.:

Quote from @Pace Jordan Morby:

We have had the due on sale clause called 4 times this month... but knowing your way around it is crucial. Either A: revert to a lease option with the option price being the mortgage balance when the option is executed... or B: Use an executory contract instead of SubTo. Land Contract. Contract for Deed. Agreement for Sale etc. I talk about this on my youtube channel.

Wouldn't the downside of doing any of those things be that if the existing owner gets any liens or judgments, they will still attach to the property? If so that's a big additional risk for the buyer. Also I don't think it's that clear that any of these tactics would actually prevent the bank from enforcing the due on sale. For example according to this, it seems that transferring the title is not required for the DOS to be triggered:

http://law.justia.com/cfr/title12/12-5.0.1.1.54.0.83.2.html
From the bank definition of sale or transfer: "For purposes of this definition, a sale or transfer means the conveyance of real property of any right, title or interest therein, whether legal or equitable, whether voluntary or involuntary, by outright sale, deed, installment sale contract, land contract, contract for deed, leasehold interest with a term greater than three years, lease-option contract or any other method of conveyance of real property interests."
That reads to me very clearly that the granting of any legal or equitable interest in or to a property secured by a mortgage can trigger the DOS, which would include any lease option, land contract, contract for deed etc. as it clearly states in the defintion. I'm not a lawyer or anything, this is just coming from what I've learned on here, there are many valuable old threads about this topic on here like this one:
https://www.biggerpockets.com/forums/83/topics/86029-subject....

and this one:
https://www.biggerpockets.com/forums/311/topics/183825-due-o..
How is it working our for you in practice?

Pace, following up on my reply to your comment above... It seems that of the options that you mentioned, only a lease option would actually work in the case of a bank enforcing the DOS. But is a lease option actually a good alternative to sub-to? Isn't the whole point of sub-to to gain title with low (or ideally no) out of pocket cost, and get the sellers (hopefully low) rate? By reverting to a lease option, wouldn't the buyer have to keep the seller in title, and wouldn't there be much higher risk when it comes to title problems, liens, judgements, etc. Also when the buyer exercises the option don't they pay full closing costs and reset at the new interest rate? Sorry but I'm not seeing how reverting to a lease option really helps for the above reasons... can you help me understand?
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Account Closed
Investor · Phoenix, AZ · Member since 2018 · 420 posts · 388 votes
3y
The point of having the clause should be obvious. It is there to protect their interest and the minute a mortgage is in trouble, you better believe they’ll enforce it.
The difference between now and the 1980’s are vast…but the PR piece alone should be telling. Nothing screams “we are in trouble” like accelerating performing 30 year mortgages. Stock prices don’t like signs of trouble.
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JD MartinBusiness Member
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Rock Star Extraordinaire · Northeast, TN · Member since 2015 · 10k+ posts · 16k+ votes
3y
Quote from @Account Closed:

The point of having the clause should be obvious. It is there to protect their interest and the minute a mortgage is in trouble, you better believe they’ll enforce it.
The difference between now and the 1980’s are vast…but the PR piece alone should be telling. Nothing screams “we are in trouble” like accelerating performing 30 year mortgages. Stock prices don’t like signs of trouble.

I don't believe that would have any effect on stock prices at all. What stockholders would even know or care that the bank called some performing loans due? This file of loans is probably not even 1/10 of a percent of whatever the bank has on their balance sheet, i.e. hardly anyone is participating in sub2. In fact, I would bet that the only stockholders that would have enough clout to move prices, such as pension funds and the like, would probably appreciate a bank that maintains clear line-of-sight between the note holder and mortgagee.
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Account Closed
Investor · Phoenix, AZ · Member since 2018 · 420 posts · 388 votes
3y
I disagree. The people doing subject-to are quite sophisticated and typically have quite the platform. Imagine Pace decides to blast a bank calling his notes due to an audience of millions on YouTube. You think that doesn’t affect the bank stock/image? You think that won’t catch a news cycle? Have you heard of GameStop? How about Reddit? How about Budweiser?
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Steve K.
OP
Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes
3y
Quote from @Account Closed:

The point of having the clause should be obvious. It is there to protect their interest and the minute a mortgage is in trouble, you better believe they’ll enforce it.
The difference between now and the 1980’s are vast…but the PR piece alone should be telling. Nothing screams “we are in trouble” like accelerating performing 30 year mortgages. Stock prices don’t like signs of trouble.
If the mortgage is in trouble that would trigger a foreclosure. DOS is for when the title transfers to a new owner (who has not been vetted by the bank, and without the bank's permission). Not really seeing the PR angle either, sorry. Not many people really know what subto is, and when presented with the conecpet, many think it's kind of shady. And like JD pointed out, a tiny percentage of transactions are made using seller financing, and an even smaller percentage of those are done using subject to. I don't think it would make any headlines even if all those loans were called tomorrow, and with foreclosure rates being as low as they are, the banks could probably resell those properties quickly at higher interest rates, pocket new closing costs, get low interest loans making less than inflation off the books, etc. Just food for thought here, all the hype around subto lately got me thinking, it's not even a strategy I typically employ but like to have in my back pocket in the rare case when it makes sense.
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JD MartinBusiness Member
Moderator
Rock Star Extraordinaire · Northeast, TN · Member since 2015 · 10k+ posts · 16k+ votes
3y
Quote from @Account Closed:

I disagree. The people doing subject-to are quite sophisticated and typically have quite the platform. Imagine Pace decides to blast a bank calling his notes due to an audience of millions on YouTube. You think that doesn’t affect the bank stock/image? You think that won’t catch a news cycle? Have you heard of GameStop? How about Reddit? How about Budweiser?

I guarantee it won't catch anything. People who are involved in anything tend to have an overinflated sense of self, ego and importance. Real estate investing is just one subset of any type of investing, residential (what most sub2 is) is another subset of that, and "creative" purchasing is a tiny subset of that. Don't conflate the one-off thing with Gamestop with what real investors with real money have on their radar. With all due respect, Pace is a nobody just like I'm a nobody and you're a nobody. He's probably less of a nobody than either of us, at least in terms of social media, but his 250k followers and 50k worth of views on his videos probably doesn't even place him in the top 10 thousand users. Bigger Pockets has over 1 million followers on Youtube and I guarantee if you walked out in the street tomorrow and asked the first random 100 people you saw if they knew what it was, you'd be unlikely to get even 1 correct answer.
Sub2 is a nobody in a subset of nobody in a subset of "yeah I've heard of that but I have no idea what it is".
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Account Closed
Investor · Phoenix, AZ · Member since 2018 · 420 posts · 388 votes
3y
Quote from @Steve K.:

Quote from @Account Closed:

The point of having the clause should be obvious. It is there to protect their interest and the minute a mortgage is in trouble, you better believe they’ll enforce it.
The difference between now and the 1980’s are vast…but the PR piece alone should be telling. Nothing screams “we are in trouble” like accelerating performing 30 year mortgages. Stock prices don’t like signs of trouble.
If the mortgage is in trouble that would trigger a foreclosure. DOS is for when the title transfers to a new owner (who has not been vetted by the bank, and without the bank's permission). Not really seeing the PR angle either, sorry. Not many people really know what subto is, and when presented with the conecpet, many think it's kind of shady. And like JD pointed out, a tiny percentage of transactions are made using seller financing, and an even smaller percentage of those are done using subject to. I don't think it would make any headlines even if all those loans were called tomorrow, and with foreclosure rates being as low as they are, the banks could probably resell those properties quickly at higher interest rates, pocket new closing costs, get low interest loans making less than inflation off the books, etc. Just food for thought here, all the hype around subto lately got me thinking, it's not even a strategy I typically employ but like to have in my back pocket in the rare case when it makes sense.
I know what the DOSC is for, and banks are more inclined to use it when payments start rolling in late.
As for the quick turn around you described…. You’re forgetting the part where the foreclosure takes 12-18 months and the bank has no payments coming in during that time. As for the PR angle…you don’t have to know what subto is. If you hear that one bank is foreclosing on a lot of people, what is your reaction going to be?

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Steve K.
OP
Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes
3y
Quote from @JD Martin:

Quote from @Account Closed:

I disagree. The people doing subject-to are quite sophisticated and typically have quite the platform. Imagine Pace decides to blast a bank calling his notes due to an audience of millions on YouTube. You think that doesn’t affect the bank stock/image? You think that won’t catch a news cycle? Have you heard of GameStop? How about Reddit? How about Budweiser?

I guarantee it won't catch anything. People who are involved in anything tend to have an overinflated sense of self, ego and importance. Real estate investing is just one subset of any type of investing, residential (what most sub2 is) is another subset of that, and "creative" purchasing is a tiny subset of that. Don't conflate the one-off thing with Gamestop with what real investors with real money have on their radar. With all due respect, Pace is a nobody just like I'm a nobody and you're a nobody. He's probably less of a nobody than either of us, at least in terms of social media, but his 250k followers and 50k worth of views on his videos probably doesn't even place him in the top 10 thousand users. Bigger Pockets has over 1 million followers on Youtube and I guarantee if you walked out in the street tomorrow and asked the first random 100 people you saw if they knew what it was, you'd be unlikely to get even 1 correct answer.
Sub2 is a nobody in a subset of nobody in a subset of "yeah I've heard of that but I have no idea what it is".

I've been in real estate for a minute and the first time I heard of Pace was Friday night when his followers started spamming the forums with a bunch of BS. Not a great first impression.
3 Reply
Steve K.
OP
Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes
3y
Quote from @Account Closed:

Quote from @Steve K.:

Quote from @Account Closed:

The point of having the clause should be obvious. It is there to protect their interest and the minute a mortgage is in trouble, you better believe they’ll enforce it.
The difference between now and the 1980’s are vast…but the PR piece alone should be telling. Nothing screams “we are in trouble” like accelerating performing 30 year mortgages. Stock prices don’t like signs of trouble.
If the mortgage is in trouble that would trigger a foreclosure. DOS is for when the title transfers to a new owner (who has not been vetted by the bank, and without the bank's permission). Not really seeing the PR angle either, sorry. Not many people really know what subto is, and when presented with the conecpet, many think it's kind of shady. And like JD pointed out, a tiny percentage of transactions are made using seller financing, and an even smaller percentage of those are done using subject to. I don't think it would make any headlines even if all those loans were called tomorrow, and with foreclosure rates being as low as they are, the banks could probably resell those properties quickly at higher interest rates, pocket new closing costs, get low interest loans making less than inflation off the books, etc. Just food for thought here, all the hype around subto lately got me thinking, it's not even a strategy I typically employ but like to have in my back pocket in the rare case when it makes sense.
I know what the DOSC is for, and banks are more inclined to use it when payments start rolling in late.
As for the quick turn around you described…. You’re forgetting the part where the foreclosure takes 12-18 months and the bank has no payments coming in during that time. As for the PR angle…you don’t have to know what subto is. If you hear that one bank is foreclosing on a lot of people, what is your reaction going to be?

I think the point is that it wouldn't be a lot of people. There really aren't many subto deals being done.
1 Reply
Account Closed
Investor · Phoenix, AZ · Member since 2018 · 420 posts · 388 votes
3y
Quote from @JD Martin:

Quote from @Account Closed:

I disagree. The people doing subject-to are quite sophisticated and typically have quite the platform. Imagine Pace decides to blast a bank calling his notes due to an audience of millions on YouTube. You think that doesn’t affect the bank stock/image? You think that won’t catch a news cycle? Have you heard of GameStop? How about Reddit? How about Budweiser?

I guarantee it won't catch anything. People who are involved in anything tend to have an overinflated sense of self, ego and importance. Real estate investing is just one subset of any type of investing, residential (what most sub2 is) is another subset of that, and "creative" purchasing is a tiny subset of that. Don't conflate the one-off thing with Gamestop with what real investors with real money have on their radar. With all due respect, Pace is a nobody just like I'm a nobody and you're a nobody. He's probably less of a nobody than either of us, at least in terms of social media, but his 250k followers and 50k worth of views on his videos probably doesn't even place him in the top 10 thousand users. Bigger Pockets has over 1 million followers on Youtube and I guarantee if you walked out in the street tomorrow and asked the first random 100 people you saw if they knew what it was, you'd be unlikely to get even 1 correct answer.
Sub2 is a nobody in a subset of nobody in a subset of "yeah I've heard of that but I have no idea what it is".
I expect you’re right because the DOSC won’t be enforced in mass. If it were…you bet your *** that the real estate world would hear about the lender who is initiating a ton of foreclosures. And 100 out of 100 people know what a foreclosure is.
0 Reply
Account Closed
Investor · Phoenix, AZ · Member since 2018 · 420 posts · 388 votes
3y
Quote from @Steve K.:

Quote from @JD Martin:

Quote from @Account Closed:

I disagree. The people doing subject-to are quite sophisticated and typically have quite the platform. Imagine Pace decides to blast a bank calling his notes due to an audience of millions on YouTube. You think that doesn’t affect the bank stock/image? You think that won’t catch a news cycle? Have you heard of GameStop? How about Reddit? How about Budweiser?

I guarantee it won't catch anything. People who are involved in anything tend to have an overinflated sense of self, ego and importance. Real estate investing is just one subset of any type of investing, residential (what most sub2 is) is another subset of that, and "creative" purchasing is a tiny subset of that. Don't conflate the one-off thing with Gamestop with what real investors with real money have on their radar. With all due respect, Pace is a nobody just like I'm a nobody and you're a nobody. He's probably less of a nobody than either of us, at least in terms of social media, but his 250k followers and 50k worth of views on his videos probably doesn't even place him in the top 10 thousand users. Bigger Pockets has over 1 million followers on Youtube and I guarantee if you walked out in the street tomorrow and asked the first random 100 people you saw if they knew what it was, you'd be unlikely to get even 1 correct answer.
Sub2 is a nobody in a subset of nobody in a subset of "yeah I've heard of that but I have no idea what it is".

I've been in real estate for a minute and the first time I heard of Pace was Friday night when his followers started spamming the forums with a bunch of BS. Not a great first impression.
Well Steve, I don’t know how to tell you this…but Pace had a show in A&E 2 years ago, rubs elbows with Grant Cardone, wrote a book for BP, and is all over social media. So while it may be your first impression, it’s not everyone’s.
0 Reply
Steve K.
OP
Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes
3y
Quote from @Account Closed:

Quote from @Steve K.:

Quote from @JD Martin:

Quote from @Account Closed:

I disagree. The people doing subject-to are quite sophisticated and typically have quite the platform. Imagine Pace decides to blast a bank calling his notes due to an audience of millions on YouTube. You think that doesn’t affect the bank stock/image? You think that won’t catch a news cycle? Have you heard of GameStop? How about Reddit? How about Budweiser?

I guarantee it won't catch anything. People who are involved in anything tend to have an overinflated sense of self, ego and importance. Real estate investing is just one subset of any type of investing, residential (what most sub2 is) is another subset of that, and "creative" purchasing is a tiny subset of that. Don't conflate the one-off thing with Gamestop with what real investors with real money have on their radar. With all due respect, Pace is a nobody just like I'm a nobody and you're a nobody. He's probably less of a nobody than either of us, at least in terms of social media, but his 250k followers and 50k worth of views on his videos probably doesn't even place him in the top 10 thousand users. Bigger Pockets has over 1 million followers on Youtube and I guarantee if you walked out in the street tomorrow and asked the first random 100 people you saw if they knew what it was, you'd be unlikely to get even 1 correct answer.
Sub2 is a nobody in a subset of nobody in a subset of "yeah I've heard of that but I have no idea what it is".

I've been in real estate for a minute and the first time I heard of Pace was Friday night when his followers started spamming the forums with a bunch of BS. Not a great first impression.
Well Steve, I don’t know how to tell you this…but Pace had a show in A&E 2 years ago, rubs elbows with Grant Cardone, wrote a book for BP, and is all over social media. So while it may be your first impression, it’s not everyone’s.

That's cool and all but A&E isn't exactly known for quality programming. Was the show in between Duck Dynasty and Dog the Bounty Hunter? Sorry I missed it. A&E is the Walmart of television. And "rubs elbows" with Grant Cardone... he better be careful doing that... my understanding is that GC may be under investigation and is dealing with a class action lawsuit from (allegedly) ripping off his investors? Gurus come and go in this biz.
2 Reply
James Hamling
Real Estate Broker · Minneapolis, MN · Member since 2011 · 5k+ posts · 6k+ votes
3y
Quote from @Account Closed:

Quote from @Steve K.:

Quote from @JD Martin:

Quote from @Account Closed:

I disagree. The people doing subject-to are quite sophisticated and typically have quite the platform. Imagine Pace decides to blast a bank calling his notes due to an audience of millions on YouTube. You think that doesn’t affect the bank stock/image? You think that won’t catch a news cycle? Have you heard of GameStop? How about Reddit? How about Budweiser?

I guarantee it won't catch anything. People who are involved in anything tend to have an overinflated sense of self, ego and importance. Real estate investing is just one subset of any type of investing, residential (what most sub2 is) is another subset of that, and "creative" purchasing is a tiny subset of that. Don't conflate the one-off thing with Gamestop with what real investors with real money have on their radar. With all due respect, Pace is a nobody just like I'm a nobody and you're a nobody. He's probably less of a nobody than either of us, at least in terms of social media, but his 250k followers and 50k worth of views on his videos probably doesn't even place him in the top 10 thousand users. Bigger Pockets has over 1 million followers on Youtube and I guarantee if you walked out in the street tomorrow and asked the first random 100 people you saw if they knew what it was, you'd be unlikely to get even 1 correct answer.
Sub2 is a nobody in a subset of nobody in a subset of "yeah I've heard of that but I have no idea what it is".

I've been in real estate for a minute and the first time I heard of Pace was Friday night when his followers started spamming the forums with a bunch of BS. Not a great first impression.
Well Steve, I don’t know how to tell you this…but Pace had a show in A&E 2 years ago, rubs elbows with Grant Cardone, wrote a book for BP, and is all over social media. So while it may be your first impression, it’s not everyone’s.

I can summarize my entire thoughts on this with 2-words:
Armando Montelongo
1 Reply
James Hamling
Real Estate Broker · Minneapolis, MN · Member since 2011 · 5k+ posts · 6k+ votes
3y
Quote from @Account Closed:

I disagree. The people doing subject-to are quite sophisticated and typically have quite the platform. Imagine Pace decides to blast a bank calling his notes due to an audience of millions on YouTube. You think that doesn’t affect the bank stock/image? You think that won’t catch a news cycle? Have you heard of GameStop? How about Reddit? How about Budweiser?

The "average" sub-to member has as much as $1,500 to their name, I don't think any bank is all to worried with a few thousand NON-mortgage holders commanding ten's of thousands in deposit dollars doing really anything. They could all disappear tomorrow putting their $ in jars and I doubt the banks would even notice.
As for stock manipulation, yeah, I feel sorry for the fool who tries nerfing a banks stock via the measure noted. That's a fast-pass too club Fed..
Sub-to is an army of poor ignorant being lead by a handful of savvy opportunists. No, not trying to insult or insinuate anything, just calling it how it is. Pace is doing great at what he does, selling hopeium like a champ, and filtering out the 1% that are actual deals to make some added returns. His REI is an after fact, the hopeium sales are primary. That's just reality of it.
4 Reply
Account Closed
Investor · Phoenix, AZ · Member since 2018 · 420 posts · 388 votes
3y
Quote from @James Hamling:

Quote from @Account Closed:

I disagree. The people doing subject-to are quite sophisticated and typically have quite the platform. Imagine Pace decides to blast a bank calling his notes due to an audience of millions on YouTube. You think that doesn’t affect the bank stock/image? You think that won’t catch a news cycle? Have you heard of GameStop? How about Reddit? How about Budweiser?

The "average" sub-to member has as much as $1,500 to their name, I don't think any bank is all to worried with a few thousand NON-mortgage holders commanding ten's of thousands in deposit dollars doing really anything. They could all disappear tomorrow putting their $ in jars and I doubt the banks would even notice.
As for stock manipulation, yeah, I feel sorry for the fool who tries nerfing a banks stock via the measure noted. That's a fast-pass too club Fed..
Sub-to is an army of poor ignorant being lead by a handful of savvy opportunists. No, not trying to insult or insinuate anything, just calling it how it is. Pace is doing great at what he does, selling hopeium like a champ, and filtering out the 1% that are actual deals to make some added returns. His REI is an after fact, the hopeium sales are primary. That's just reality of it.

That’s a bold claim to make ON the forum run by his publisher. But ok 🤷🏼‍♂️
1 Reply
Joe S.Pro Member
Investor · San Antonio · Member since 2020 · 3k+ posts · 3k+ votes
3y
Quote from @James Hamling:

Quote from @Account Closed:

Quote from @Steve K.:

Quote from @JD Martin:

Quote from @Account Closed:

I disagree. The people doing subject-to are quite sophisticated and typically have quite the platform. Imagine Pace decides to blast a bank calling his notes due to an audience of millions on YouTube. You think that doesn’t affect the bank stock/image? You think that won’t catch a news cycle? Have you heard of GameStop? How about Reddit? How about Budweiser?

I guarantee it won't catch anything. People who are involved in anything tend to have an overinflated sense of self, ego and importance. Real estate investing is just one subset of any type of investing, residential (what most sub2 is) is another subset of that, and "creative" purchasing is a tiny subset of that. Don't conflate the one-off thing with Gamestop with what real investors with real money have on their radar. With all due respect, Pace is a nobody just like I'm a nobody and you're a nobody. He's probably less of a nobody than either of us, at least in terms of social media, but his 250k followers and 50k worth of views on his videos probably doesn't even place him in the top 10 thousand users. Bigger Pockets has over 1 million followers on Youtube and I guarantee if you walked out in the street tomorrow and asked the first random 100 people you saw if they knew what it was, you'd be unlikely to get even 1 correct answer.
Sub2 is a nobody in a subset of nobody in a subset of "yeah I've heard of that but I have no idea what it is".

I've been in real estate for a minute and the first time I heard of Pace was Friday night when his followers started spamming the forums with a bunch of BS. Not a great first impression.
Well Steve, I don’t know how to tell you this…but Pace had a show in A&E 2 years ago, rubs elbows with Grant Cardone, wrote a book for BP, and is all over social media. So while it may be your first impression, it’s not everyone’s.

I can summarize my entire thoughts on this with 2-words:
Armando Montelongo

https://www.biggerpockets.com/forums/79/topics/93251-meet-ar...
Here is an old thread to the guy you mentioned. Not necessarily for your benefit because you already seem to know of him. I looked him up and this popped up.
2 Reply
James Hamling
Real Estate Broker · Minneapolis, MN · Member since 2011 · 5k+ posts · 6k+ votes
3y
Quote from @Account Closed:

Quote from @James Hamling:

Quote from @Account Closed:

I disagree. The people doing subject-to are quite sophisticated and typically have quite the platform. Imagine Pace decides to blast a bank calling his notes due to an audience of millions on YouTube. You think that doesn’t affect the bank stock/image? You think that won’t catch a news cycle? Have you heard of GameStop? How about Reddit? How about Budweiser?

The "average" sub-to member has as much as $1,500 to their name, I don't think any bank is all to worried with a few thousand NON-mortgage holders commanding ten's of thousands in deposit dollars doing really anything. They could all disappear tomorrow putting their $ in jars and I doubt the banks would even notice.
As for stock manipulation, yeah, I feel sorry for the fool who tries nerfing a banks stock via the measure noted. That's a fast-pass too club Fed..
Sub-to is an army of poor ignorant being lead by a handful of savvy opportunists. No, not trying to insult or insinuate anything, just calling it how it is. Pace is doing great at what he does, selling hopeium like a champ, and filtering out the 1% that are actual deals to make some added returns. His REI is an after fact, the hopeium sales are primary. That's just reality of it.

That’s a bold claim to make ON the forum run by his publisher. But ok 🤷🏼‍♂️

Why?

Do we no longer get Freedom of Speech?
Are you concerned that said Freedom of Speech would impact book/program sales? You point out specifically "... on forum run by his publisher." Doesn't seem a great argument against the premise I posed that program sales are primary, REI is after-thought/action. Actually, seems like you AGREE with me.🤷🏼‍♂️

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