All Forum Posts by: Steve Hodgdon

@Dion DePaoli @Bob Malecki @Jay Hinrichs @Bob Berland  @Andy Mirza @Chris Seveney   In, of course. I can bring weekly data from our unsecured book. A glimpse in real time of requests for forbearance, missed payments of 1300 borrowers. You say "there are only 12 days a year in mortgages". So deterioration comes slower than in a mortgage portfolio. 

Are your performing notes now not performing? 

Are you running out of "exits" for your NPLs? 

Maybe you're not structured to run a collection operation?

Maybe you're not thrilled with your servicer or the costs for delinquent accounts?

Are you trying to figure out what to do with your assets? 

Maybe we should talk. At least to offer suggestions. Tell me about your problem and let's try to find solutions. 

I'm not a big buyer and have found caveat emptor applies. Counter party risk and real valuations are keys. I trust @Dion DePaoli to guide me in purchasing.  

We occassionally sell performers but don't have a reliable direct connection to NPNs.

I have no contact at Harbour. 

When we wrote new CFD it included clause allowing interest on property taxes and other advances

Biggest risk in real estate is counter party risk. The actual asset is second.

Hi BPers' -

We're a licensed lender in California. Just started to experiment with small fix up loans to home sellers. Compass and Berkshire are offering home sellers ZERO interest loans to fix up their houses for sale. 

This has created a scramble for independent brokers. We put together a program to help them compete.

85% max CLTV

5% of CMA value max loan amount. i.e. 25,000 for a house worth $500,000. Any use home owner chooses. Staging, minor repairs, carpet, paint. Focusing on quick spruce up, not construction projects.

No payments. One time interest charge. Loan term 8 months. Demand letter in escrow. Default rules - cancelled listing, 8 months expire triggers a 5% increase interest charge. 

So, writing little loans, 10-50k. Typical payback will be 4 months will net a gross return in the 20%+ range. Average DOM here 65 days. 

Somebody poke some holes in this. I think I have more business than I can absorb. Anybody have experience raising capital for something like this? Thinking I'd sell individual loans with a revenue share so I'm not creating a security. 

Just a quick update on my first note. Borrower paying 11/12 on time. Paying extra as best he can. Behind on property taxes. I paid and added to the account at FCI, so getting 8.75% interest on the tax bill too. Property is pretty shabby but what do you expect for $23k in South Carolina. It's a CFD. FCI wouldn't let me sell it since not a mortgage. Just put it on the back shelf and money comes in almost every month. Return? Since I'm advancing taxes, yield is reduced to 12% after servicing cost

@Adam Johnson  Well, I've been buying/collecting unsecured debt for 30 years. Was an active investor in bank card, payday loans etc. "retired" in 2006. I owned collection agencies for 18 years.
I bought one Harbour Portfolio non performer to get my feet wet. Decided I understood the concepts and had enough similar experience. So, I found Dion DePaoli here on BP and we bought a small pool from a fund, then some one offs from various sources. Got creating my own paper in Pensacola where I had a contractor I trusted. We rehabbed 4 properties and sold them on terms. 
Un-retired and building a discounted paper business which includes medical loans and 2nds. 

@Adam Johnson My very 1st note is a CFD in Greenville in 2016. Your backyard! He''s still paying. Since then we've bought 33 notes, sold some, had some payout and others go to foreclosure. Also found solid success in seller finance deals where we combined our real estate and note experience to make WIN/WINs for renters and us. Controlling the property has been a good hedge against counter party risk. Often it's WHO you deal with, not WHAT you buy.

https://fred.stlouisfed.org/ This can give you to 10,000 foot view.