All Forum Posts by: Matt Skog

Great thread here. You have all been advised by a few of the top game-changers in NPN investing. You would be wise to join a few of the note investment groups out there on Facebook. I believe I am at or near 10 of them myself. I've found the tendency to make an original post only in groups that are *not* public. I have many well-meaning family members who poke their noses in when I make some comments in public group settings. With a closed group, they can't see my posts or comments unless they join a particular group that I'm in.

Great points, Dan. I'm of the same philosophy when it comes down to it all. My particular set of skills, if I'm thinking about growing my money partners' checkbook first, will reap its rewards in due time. Just as with any particular avenue in the RE realm, if you build your network by making everyone else rich first, you're going to have the chance to be rich in the end.

Unfortunately, MN REIA has always been too narrow minded in scope from what I've taken from it. A (former) friend of mine was heavy into this a few years before the subprime meltdown, and was hit hard by foreclosures to his properties because he was too highly leveraged, usually buying with little to no equity built in. Agree with the too much pitching, and not enough plain old-fashioned networking.

Glad to see your interest in notes. Most people get involved by brokering the notes to vetted note buyers. There are several people on here who can help educate you, who don't charge $20-40K for the info. These "boot camp" people are frauds who are just out to rip you off. Start searching for Dave Van Horn or Bob Konipol. The marketplace is far from saturated. Concern your efforts to good, solid paper first. NPNs are for advanced practicers of paper, who have the expertise to deal with them, who have significant money reserves to deal with people who aren't paying on their mortgage. Once you've made money from several deals, and have a desire to increase your potential yield, go ahead and try a delinquent deal, but DON'T start with one. Hope this helps your venture!

@SarahJunker

Also, don't be afraid to be proactive and CREATE notes. One completely overlooked aspect of this is using MLS properties over 90 days old, but still active. When you can find some homes with over a 60% equity cushion, chances are good that it's a new retiree looking to move to a retirement community. Those deals are what I seek out. Especially the ones who want some delayed capital gains. Just some food for thought, not all notes need to be seasoned. Green notes can be even more lucrative than finding someone else's notes.

@JoeLopez

Illinois has a two year redemption period at 18% interest. You purchase the tax lien from the county courthouse, or its authorized seller. Joseph Meyers Real Estate Company has agreements with 48 Illinois counties to purchase all liens not sold at their annual auctions. They receive the liens at 18%, take title to all not redeemed, and then hold private real estate auctions throughout the state. Quoted from the 'Wealth Without Risk' tax lien investing book by Saen Higgins. I hope that this helps you find some deals. Good luck in your ventures!

@RachelNunes

Go to the property research area at the county courthouse. You can look up all mortgage transactions that are recorded. A word of caution with it though: NEVER make a deal with a seller who has an unrecorded mortgage. Family deals, etc. But the courthouse has all recorded transactions. It's a great start toward due diligence. Get a title company to perform proper due diligence until you understand everything that they cover to protect your interests. I hope that helped enough. Good luck in your ventures!

@RachelNunes, My thoughts on this are that perhaps you may want your purchases less heavily leveraged? The types of deals I like finding are long-term residences looking to sell, which have significant equity built into the deal. I've been able to come across about two dozen properties within a ten mile radius that are for sale by the MLS, and have at least a 60% equity cushion. While I realize not EVERY seller is going to sell with some degree of seller financing involved, the ones on the market for 90 days are more likely to do so to make a sale. Especially those wanting to move into a retirement community. Just a thought to consider.

Brandon Sturgill, no problem. Just last week I did some due diligence on a single family home close to the fairgrounds of Anoka County, MN. I found that the couple was wanting to retire down south. Their mortgage had been satisfied five years ago, and no satisfactory offers had come their way in looking to sell. No major repairs were needed, their home was only thirty-five years old. Just a lot of deferred maintenance. We are in negotiatons that would give them more than full price, with VERY FAVORABLE terms for both sellers and myself. Comps in the neighborhood have sold for $190-210K recently. We are looking at a new conventional First for $60-70K, with the seller carrying back $100K at 11%. Seller subsequently agrees to sell a partial Second. After consulting my attorney, he agreed that with such a low balance on the new First, that my equity stake is highly protected against a defaulted Second. We should be closing the deal very soon. I hope that this was enough detail with REAL numbers. Good luck with your ventures!

Some older home sellers actually do this intentionally. They may have major repairs necessary, and to more easily make a sale, will sell it as a fixer-upper. If the house has an existing mortgage on it, the seller may help the buyer by creating a new first mortgage to satisfy the existing one. Then will carry back a second, to make a full sale price, or charge a high interest rate so as to make passive income, to delay paying capital gains. There are several strategies that can be used by an experienced seller.