All Forum Posts by: Jay Hinrichs

@Jesse Brown

however if your dead set on using an attorney e mail me and I will recommend a few I use. beware though any attorney worth there salt in PDX is 350 plus an hour.

Stuart fox can probably help you look him up.

Unless your doing some super complicated transactions an attorney is not needed in an Title and escrow state.. pretty straight foreword deals here.

I use Action services for all my tenant issues cost 1/3 of an attorney and that is all they do they are better than most law firms that may dabble in tenant issues.

Good luck with your endevours.

@Brian Winberry

my only question is how could you negotiate the ad valorum tax's to zero ? I don't think that is possible maybe in other states but not here on the west coast

@Dave Van Horn

I suppose every state will have a different take on this.. I can't say I am 100% certain but I am 98% certain this would not fly in Oregon or to an Oregon resident. Been there done that with the state regulators any form of buy back guarantee etc would require some sort of securities offering. In Oregon its called a Real Estate Paper offering.. And its a Minnie reg D filing. Not that what your marketing cant be done but the state of Oregon wants full disclosure to their citizens.

So the question becomes. And if I may take the liberty to play devils advocate here.

And I really don't know anything about your business other than I think your selling non performing second trust deeds or mortgages and by your post your offering to service them or replace them if they go bad. I suspect you buy them in bulk for pennies on the dollar then re assign them and make a profit selling them ( does not take a rocket scientist to figure that one out).

So from an investors stand point. And we already know this is high risk defaulted paper in second position.. So the most risky notes you can buy ( except for 3rds)

So we know these are going to default and probably default at a pretty high rate I would suspect 50% or better ( do you provide this information to your buyers IE how many have defaulted).

So I am a buyer of a 2nd it craters and now your going to step in your not going to give me my money back just replace the note.. What if I don't like the note your replacing me with.. How do you handle that.. Does the investor just have to take one that match's monetarily or do you send them 10 and tell them to take their pick.

What happens if there is a run on the bank.. How many of these do you have in reserve to use as substitute collateral. And or do you have any data on how successful your buyers are over time getting these things up and running and keeping them running. How do these investors handle the senior liens if the second is non performing the first usually is these people usually pay the second and not the first because its a smaller payment and no one said the US borrower is that versed in RE and credit.

Back in the day in California we sold notes all the time with an endorsement on the back "with recourse" this meant if it went bad we had to cash them out. and take over the position..

Just seems like warranting a second that is NPN is just highly risky from your perspective.. And what happens if a note default 7 years from now and your no longer in bizz your retired what is an investor going to do then.. Or is there a sunset IE if the note holder pays 24 months the warranty is over. that would make sense.

Anyway look forward to hearing how you handle this.

Last comment if you are selling these notes for 1k to 5k then forget everything I just said other than the legalities of a warranty. too little of money to worry about if they go TU

@Account Closed

The only redemption right a CA owner has is not really a redemption right is a Voidable right.. If they can prove the TAX collector did not follow the statutory advertising rules. IE publish 21 days in the local paper then a petition to the court within 1 year can get the property back for the one who lost it... I know it happened to me one time. County screwed up only advertised for 20 days.. Judge ruled the sale was voidable and voided that one property sale not the entire sale.. It would have taken each and every person to bring a separate claim to void the sale but everyone who lost a property that year would have won.. But you know CA.. 95% of the properties that go to sale are junk anyway and only those not in the know buy them.

@Sean OToole

Just need a turbo charged aircraft or a turbine and your fine.

great airport other wise and the approach into it the views are amazing. Love that part of the world.

One can pretty much conclude if a property went for 1 dollar over minimum bid collusion of some sort may have taken place. As Sean mentions the competition these days at court house steps is intense and if a property goes 3P that means it had some equity and there would be multiple investors tracking it ( of course there is always the home owner buying it back and will pay more than an investor or someone who actually wants to move in and will pay right up to fair market value for it).. The offended parties are the owners who lost it ( if they had no junior liens or judgments) or any junior ..The First Lien holders that are the ones foreclosing 95% of the time are not entitled to ( at least in the states I work in) to any money above their stated opening bid.

Overages at the sales are handled different ways in different states. Here in Oregon the Trustee simply contacts the next in line and says there is money waiting. In Washington one needs to make a motion with the court. Not sure how CA is handled.

@Siddharth Shastri

@Cody Cox

Sidd not sure what area of Oregon you coming to but sub 100k homes are pretty rare in this area. I used to own Silverado Funding they are a good outlet for HML in the PDX market. If you need a JV partner you can contact me I only do JV's these days.

Good luck and welcome to Oregon.

@Sean OToole

the bid rigging was rampant in Oregon in my day at the court house steps.

And I know its common in almost all markets.. ( IE hey here is a thousand bucks go have lunch)... Or I have witnessed much higher negotiations between parties... some of these guys were just so brazen it was unreal.

I was not mr popular If I wanted a property I bid what I would pay and disregarded the attempts to buy me off.

Although there were many who showed up to the sales with NO intention of buying and just hoping for a payoff...

I remember some guys in either NC or SC getting nailed by the feds about 07 or so.. 800k fine and not sure about jail.

In my really early years in Oakland CA Alameda county.. You had Al Florida and Shep they showed up with a suitcase full of cash and a 356 magnum you did not screw with those dudes .. they had an office next to mine, I was running a HML company at the time. The front of their office had a bunch of guys cutting out the NOD's and such and pasting them to paper LOL the good ole days.

PS love Truckee,, I flew in there in my plane a few years ago for golf at OLD Greenwood.. When I went to depart there are big signs showing density altitude that day it was 8800 feet... My bird could handle it but many would have been grounded.

@Reginald S.

My first comment is I don't think your going to be getting a deluge of phone calls in the first place... And if you get a foreclosure situation just make a deal with a local wholesaler investor and bird dog it for them.. When you get the call.. Just tell them its not your area of expertise but you are going to put them in touch with someone who is well versed at it. ETC ETC.

But don't be afraid to talk with them, and get the skinny you will learn a lot about how this bizz works talking with any and everyone who wants to sell be it distressed assets.. inherited and wants quick cash.. etc.

My most successful clients that I fund for this activity don't wait for calls they identify the properties then attack it like they were private investigators doing a skip trace that's were the deals are made.

Nice thread guys... I think what I take from this is that buying NPN is pretty complicated stuff, and like buying ghetto rentals when you live in CA. the same caveats apply. And even more so with the NPN's.. you have debtors and debtors attorney's that will do everything in their power to keep the debtor in the property, and each state has different rules etc etc. Seems to me this is a full time business or for the very educated RE investors. I could see newbie investors just getting killed trying to do this. But I guess the lure of the highest returns will always sway those to give it a shot.

And of course as has been stated one would need to categorize each type of note from Owner occ primary residence to non owner occ commercial etc etc. I would think the rules are different in each case and in each state.

From my limited experience in looking at some bank tapes.. these were 2 to 5 mil they would not sell them to anyone who was not a or did not have a licensed servicer. So I experienced that one..

So my assumption is that you have Note Wholesalers who have the ability to take down a big tape.. then they allow investors to cherry pick the notes IE the little investors or newbie investors that just want to buy one or two notes and from what I saw on some of the tapes I looked at the low value collateral loans sold for very low dollars ( west coast perspective) so an investor can buy a note for 5k or 20k or whatever and give it a go.

That's the position I would want to be in.. buy the big tape and then just resell to mom and pop investors and let them go through all the work of reinstating or foreclosing.