All Forum Posts by: Cody Cox

Awesome information. We are still way overdue on having coffee together. What are your thoughts on having a periodic meeting of the folks involved in this group?

Have you seen any conversation regarding Oregon allowing a Series LLC?

Most note purchasers that buy reperforming notes prefer a 12 - 18-month history of good payments. The longer that history, the better resale price you could reap.

If you get 3 -4 months upfront, 12 - 18 months of a payment stream, then a lump sum when you sell the reperforming note, you achieve 3 profit points on one file.

I'm not sure how you would be able to get $5,000 from the borrower up front. If they are only 4 months in arrears they would only need $2,879.12 to bring current. 6 months of seasoning might not be sufficient; you may need at least 12. The costs you reference ($5,000) are part of your discount purchase price from the note seller. I never pass these costs to the borrower. They are already struggling. Factor those costs into your costs of acquisition.

This appears to be headed for a first payment default. It also appears to be a seller-financed transaction. The sales price appears to be $260,000, so there is pretty good equity in this property. You should assume you would foreclose and then resell the property. I always assume a worst case scenario. Being in Texas, your foreclosure timeline is shorter. Anticipate a 12-month hold, but it would most likely be about 6 months. Calculate all your anticipated expenses in that 12-month period, including servicing fees, potential property taxes, attorney fees, etc, and then run the numbers for a decent return. 

True, but if you purchased the note, there should have been an Assignment recorded to show your ownership of the note. If you are at the foreclosure stage, either this did occur or the AOM was not recorded. You should have that recorded and make contact with the foreclosing attorney.

Your attorney would handle all the coordination of that. You do not physically need to attend a sheriff's auction as the lender.

When you purchase a note from an exchange, you will generally pay more, thus lowering your ROI. I purchase directly from banks or hedge funds, at a greater discount. This improves my yield. Further, if the toilet breaks in the middle of the night, I don't get a call. Plus, notes are secured by a tangible asset: real estate. When buying at a discount, that provides a cushion in the event of an economic downturn. With stocks, you feel that pretty quickly. Just my quick thoughts.

Theoretically, the servicer must apply funds according to the promissory note. The note will dictate how funds are applied. Go back and read that, then if they didn't apply as indicated in the note, then have @shanteduffy work her magic.

Generally you won't. As @jayhinrichs indicates, rarely if any does this occur.