All Forum Posts by: Bill B.

Search WECloseNotes.com and/or Scott Carson on YouTube and Vimeo and the internet in general.

Scott is one of my mentors. (although I am far from his most successful protege.....not his fault, my fault...) That said, I’ve completed three npn deals successfully with embarrassingly good returns.

Scott gives massive value, much of it for free.  He just finished a Note Camp and will host a Note Buying For Dummies soon.  

I hope this is helpful.

Search WECloseNotes.com and/or Scott Carson on YouTube and Vimeo and the internet in general.

Scott is one of my mentors. (although I am far from his most successful protege.....not his fault, my fault...) That said, I’ve completed three npn deals successfully with embarrassingly good returns.

Scott gives massive value, much of it for free.  He just finished a Note Camp and will host a Note Buying For Dummies soon.  

I hope this is helpful.

@Patrick Desjardins

Thank you for your reply.

May I ask what the borrower is alleging in the law suit? And what your plan is to address the lawsuit?

Thank you for your time and effort.

Bill

@Linda Hastings

Thank You!!! 

That is exactly what I needed!!!

Hi!

I am very close to closing my third NPN note file.

So far, all have been profitable.  (Thanks to God, my mentors, and BP!!)

The immediate question I have is, what do I do with closed files?  I'm planning to keep them for tax purposes, but are there any other legal requirements that compel me to hold onto files that are closed?

I'm thinking of having some of the mortgages "mounted".  Specifically, in a frame with matting. I may possibly include a plate at the bottom with facts about the file: 

Deal#: X,XXX

Purchased XX/XX/XXXX  

Exit: XX/XX/XXXX 

Annualized ROI: XX.XX%

Exit Type: XXXXXXXX 

Investor Return XX.XX%

I figure if big game hunters can mount their "kills", I can mount mine!!!  (Elmer Fudd voice: "SShhhhh!!! I'm hunting bad debt!!!")

Being as my home is not a public space, I don't believe I'd be making the information "public".

Thoughts?

Concerns?

Ideas?

Criticisms? 

Thanks to all!

Bill

Hi!

I'm evaluating two NPN investments. The twist is that they are Owner Financed notes.

Are there pitfalls and/or unique issues tied to the fact that the investments are NOT institution based, but owner financed?

I'm most concerned that the note and mortgage are legal and enforceable.  

Can someone point me to the "south forty" so I can plow it for this information?

Thanks!!!!

Bill

@Patrick Kucera 

First and most importantly, Thank You and your family for your service to our country.

Congratulations on investigating notes!! They have a LOT of attributes that parallel buy and hold. There are many differences as well. Most notably, no tenants, no toilets, and no trash.  

The single biggest detriment to notes is that the cash flow ends at some point. That can be mitigated by setting aside "reserves" just like you would for a buy and hold property, but instead, you deploy those reserves into additional notes.

I have NOT purchased a performing first.  I'm learning about and have successfully invested in three non-performing firsts.  Buying re-performing notes from entities that invest in non-performing notes is one source to consider.  The last statement is NOT a solicitation as I have NO inventory to sell!!!  :-)   

More seriously, you can find NPN investors here on BP. Be careful as re-performing, by definition, means that the note was NOT performing. This is NOT any type of statement regarding any investor on, or off of BP. It is recognizing the fact that notes ARE different. As Bill Gully states so clearly; notes are finance, NOT real estate. There are a whole BUNCH of moving parts and laws that are very different from real estate. This is NOT to turn you away from notes. It is just so that you enter the investment with eyes WIDE open and with full knowledge that the learning curve is standing straight and tall.

If you have not already heard of @Dave Van Horn, I strongly suggest that you search for his blog on BP and binge out.  Dave's company PPR is a great resource as well.

I'd like to recommend that you visit this website: https://papersourceonline.com/

When you return to the states; the Mencarows host a wonderful event in Las Vegas every April.  There is NO selling from the stage and you will learn more than you can imagine about investing in performing notes and alternative streams of cash flow.  The separate site for the live event is http://papersourceseminars.com/

If you are able to attend, I promise it will be very helpful and enlightening.

I hope this is helpful.

Bill

@Jay Hinrichs Thank You Jay for straightening me out.  As I've stated, I know I have a long way to go.  But, I have some great mentors and I also have people who are generous with their time and experience, like you, here on BP.

As stated by @Tim S., FC on the second does not give you title.  Tim Simmons outlined the facts pretty well.  I'd like to add that investing in seconds is investing in the borrower.  Do they want to keep the home?  That is answered most clearly by seeing a first position note that is current.  That can't be determined by the data you provided.  Even if you know that the first is current, there are many other variables that must be addressed before you invest in any note, first or second. 

Were the loan and mortgage created properly? Is there clear and clean chai of title from the originator to who owns the note now?  Are property taxes current? Are there fines for maintenance levied by the city?

Again, the examples above are just a few of the many variables that must be investigated BEFORE buying the note, first or second position.

I strongly suggest that @Johnny Hoang and @Account Closed both find an experienced note investor to learn from.

I hope this helps.

I am far from the most experienced investor, but my understanding is that owning the note gives you ZERO rights to the rents of the current occupants.  Owning the note gives you the right to the mortgage payments due under the note ONLY.  The building could be 100% vacant and the borrower would still owe you the monthly payments.

If the borrower defaults, you have the right to foreclose and take ownership of thenproperty.  

The question is, would you WANT to own the property?  Has it been maintained or does it require $1,000,000 to make it rentable and structurally stable??  Is it in a bad area of town or an area in which you would want to live?

NONE of this speaks to the possible problems with the note and associated mortgage.

It MAY be a good deal.  The only way to know is to understand all the variables noted above plus the myriad variables that are not listed.

Team up with an experienced note investor that has experience with multis.

Better to have PART of a good deal that ALL of a bad deal.

I hope this is helpful!

Bill