Who's laughing NOW Mary ... :)
Did you know you can actually make $ without working
Mary
All my family and friends laughed when I told them
that I was going to make insane amounts of $ without
EVER going to work... Well who's laughing now ... Read on...
True story but the problem is most forget the #1 reason
how this is possible.
Is it the next best RE Deal? NOPE!
Is it the next best Cure to (You fill in the blank) ? NOPE!
Is it to make life easier doing xy and z? NOPE...
Seriously I'm going to share something with you that
I've never shared with ANYONE.
Yesterday ALONE we generated over $8,292.16 in
less then 24 hours.
Best part is this doesn't include the 28 RE deals we did.
Now I'm not sharing this to impress but to impress upon.
This is 2010 and if YOU yes YOU are not making at bare
bones $164.26 a Day doing Absolutely nothing well
you are missing the boat.
Can you make more OHHH yeah but and this is a Big but...
You must get this "1" piece down before any of this is
possible... By the way I don't care if you have the best
deal in the world without this it doesn't matter.
>> CLICK HERE TO WATCH THE VIDEO <<
Not a snobbish but a stubborn comment to all the people
Who laughed at me (Friends and Family)...
Who's laughing NOW?
Saturday, July 24, 2010
Push 5 buttons and make more $ in 1 day "Not Working"
When you get this you can sit anywhere in the world and
literally push 5 buttons and make more $ in 1 day "Not Working"
then they can do in a 50 hour a week J O B for an Entire month...
Yes only 1 email.
I'm not knocking it and I'm for sure not telling YOU it will be a
bed of roses but I can tell you this if you get this "1" thing
that my boy Ryan shares with you it will set you FREE from
the JOB faster then anything YOU have ever seen before.
I'll even do 1 better because this is my LAST email about this.
Watch the video and take the ACTION that Ryan tells you to
take and if it's not everything he says it is I'll send you a
crisp $100 bill myself.
Yes $100 smackaroos ... Just for following his steps and
trying to prove him wrong.
I mean it, I'm putting my 14 years of reputation on this.
You have nothing to lose, Actually you have $100 bucks
and an amazing life to gain by getting over to:
>>> CLICK HERE <<<
I'm not knocking the working people by all means however
I'm knocking the nay Sayers.. YOU have nothing to lose
and a Whole lot to gain by understanding this "1" tool
that 99% of investors are ignoring, But not YOU, You are
to smart to Ignore something so powerful.
SMART PEOPLE WILL GET OVER TO:
WELL Nay Sayers who want to prove me wrong and get
a shot a getting a crisp $100 Bill will go:
This is the last time I'm sending this email quite frankly
because I don't want everyone to know about it.
Well It's getting late 9:37 pm Est and I've been up working
on a FROG.. (OOOPS ) That slipped I mean a secret
project that will get you making even more $ doing
absolutely NOTHING Guaranteed.
Right it down " RIBBIT " on your Calender for
August 26th... It's going to change the RE Game
and for everyone who gets over to:
YOU Will get in FIRST AT NO CHARGE As my way of saying
Thank you for being a smart Investor.
Action Takers get rewarded...
Well with that said... YOU all you have to do is follow
step by step, paint by numbers to gain an advantage
over 99% of the RE investors and it's staring YOU right
in the face the Solution, which path do you take?
I know it's overwhelming sometimes but trust me that
when you get this "1" piece locked down you will realize
that YOU will never be overwhelmed with the negative
side of it only the positive side of it.
It's up to you I've got a $100 bill with your name on
it and waiting on you to prove Ryan wrong, nothing
to lose only EVERYTHING to gain.
Off to the Theatre room to watch some tv now why
my biz works for me and the best part is you can do
the SAME Exact thing ...
Your Friend and Mentor,
Mark Evans DM
literally push 5 buttons and make more $ in 1 day "Not Working"
then they can do in a 50 hour a week J O B for an Entire month...
Yes only 1 email.
I'm not knocking it and I'm for sure not telling YOU it will be a
bed of roses but I can tell you this if you get this "1" thing
that my boy Ryan shares with you it will set you FREE from
the JOB faster then anything YOU have ever seen before.
I'll even do 1 better because this is my LAST email about this.
Watch the video and take the ACTION that Ryan tells you to
take and if it's not everything he says it is I'll send you a
crisp $100 bill myself.
Yes $100 smackaroos ... Just for following his steps and
trying to prove him wrong.
I mean it, I'm putting my 14 years of reputation on this.
You have nothing to lose, Actually you have $100 bucks
and an amazing life to gain by getting over to:
>>> CLICK HERE <<<
I'm not knocking the working people by all means however
I'm knocking the nay Sayers.. YOU have nothing to lose
and a Whole lot to gain by understanding this "1" tool
that 99% of investors are ignoring, But not YOU, You are
to smart to Ignore something so powerful.
SMART PEOPLE WILL GET OVER TO:
WELL Nay Sayers who want to prove me wrong and get
a shot a getting a crisp $100 Bill will go:
This is the last time I'm sending this email quite frankly
because I don't want everyone to know about it.
Well It's getting late 9:37 pm Est and I've been up working
on a FROG.. (OOOPS ) That slipped I mean a secret
project that will get you making even more $ doing
absolutely NOTHING Guaranteed.
Right it down " RIBBIT " on your Calender for
August 26th... It's going to change the RE Game
and for everyone who gets over to:
YOU Will get in FIRST AT NO CHARGE As my way of saying
Thank you for being a smart Investor.
Action Takers get rewarded...
Well with that said... YOU all you have to do is follow
step by step, paint by numbers to gain an advantage
over 99% of the RE investors and it's staring YOU right
in the face the Solution, which path do you take?
I know it's overwhelming sometimes but trust me that
when you get this "1" piece locked down you will realize
that YOU will never be overwhelmed with the negative
side of it only the positive side of it.
It's up to you I've got a $100 bill with your name on
it and waiting on you to prove Ryan wrong, nothing
to lose only EVERYTHING to gain.
Off to the Theatre room to watch some tv now why
my biz works for me and the best part is you can do
the SAME Exact thing ...
Your Friend and Mentor,
Mark Evans DM
CASH FLOW BUSINESS TIP OF THE WEEK
CASH FLOW BUSINESS TIP OF THE WEEK
This series started with the outline of the three goals of a successful marketing plan: Keep, Create and Repeat. Please refer back to previous tips. We will continue with - Keep, Flyers and post cards.
You could have your postal cards prepared using some of the ideas already mentioned in previous lessons. Now here's a secret that most savvy marketers know and use all the time: take any one of the postal cards (or flyers, etc.), print it on different color paper and mail it to the same person more than once over a period of time. What happens is this. Every time you mail that same item and print it on a different color, the person who receives it thinks it is different from the last item even though the message is the same. Using this trick you can accomplish two things:
1) You can double the mileage you get from each piece and
2) you drive your message home and reinforce it by frequent repetition.
You should also take a minute and look at all of the programs we offer to help you succeed in the Cash Flow Business. You can see them all here:
http://noteinvestors.com/store
This "Tip of the Week" will help you succeed in the note business. Each weekly "Tip" stands on its own, but is more valuable along with the whole series. Read ALL of the Tips by clicking on the link below:
http://noteinvestors.com/tips.htm
This series started with the outline of the three goals of a successful marketing plan: Keep, Create and Repeat. Please refer back to previous tips. We will continue with - Keep, Flyers and post cards.
You could have your postal cards prepared using some of the ideas already mentioned in previous lessons. Now here's a secret that most savvy marketers know and use all the time: take any one of the postal cards (or flyers, etc.), print it on different color paper and mail it to the same person more than once over a period of time. What happens is this. Every time you mail that same item and print it on a different color, the person who receives it thinks it is different from the last item even though the message is the same. Using this trick you can accomplish two things:
1) You can double the mileage you get from each piece and
2) you drive your message home and reinforce it by frequent repetition.
You should also take a minute and look at all of the programs we offer to help you succeed in the Cash Flow Business. You can see them all here:
http://noteinvestors.com/store
This "Tip of the Week" will help you succeed in the note business. Each weekly "Tip" stands on its own, but is more valuable along with the whole series. Read ALL of the Tips by clicking on the link below:
http://noteinvestors.com/tips.htm
Thursday, July 15, 2010
A Billionaire in the Making
I'm beginning to seriously wonder about you. Are you allergic to wealth or something? The only way you could be getting this email is if you haven't invested in my digital book yet. And that makes no sense. It's the best thing in the world. It's better than sex. I'm not kidding. I literally stopped having sex ever since I wrote this book because reading it is way better. Try it. You'll see. It'll be like an Herbal Essence commercial while you're reading.
Today you're getting the entire introduction for absolutely no charge. I'm getting a little tired of typing that word FREE. I'd much rather start typing the word 10 MILLION DOLLARS. Man I just had a fantastic idea. I'm giving you 2 more days to buy this book, and then I'm raising the price to 10 MILLION DOLLARS. If that's not incentive I don't know what is. Enjoy ...
Introduction
Dang I hated school. Hated homework. Hated gym class. Hated getting beat up by football players every time I did the littlest thing (like take their girlfriends by accident). School just wasn't for me. I always knew I would not be going to college. My friends in high school used to ridicule me for not aspiring to higher education. They couldn't comprehend why on earth I wasn't following all of them with every little thing they did.
They just didn't get it.
Well, they started comprehending and "getting it" when I rolled up in my Lexus complete with 18" rims and sound system at age 21 while they were still in school living off mommy and daddy. And they definitely get it now that they see the 745 with 22" rims I've upgraded to and the waterfront penthouse I live in.
They get it so well that some of them have signed up as my students. They have the college degrees, but they are now learning at my feet the true ways of the world of money which school unfortunately just does not teach.
By the way I'm not bragging with the whole 745/penthouse thing. Its just stuff; you could take it from me and I'd be just as happy (I think. Please don't test me on that, God!) I'm just setting the stage is all. Painting a picture if you will.
Now, I am not bashing school whatsoever. Some people need it. Doctors need it. Attorneys need it. Plenty of worthy professions which this world would suck without need organized education. I'll probably even recommend to my kids that they go to college ... But I won't force them to.
Not everyone is cut out for it, and not everyone needs it. I'd be more of an advocate if they would just teach what we really need - life skills!
Have any of you read Rich Dad Poor Dad? Well go read the entire series. They will change your life. They changed mine. They took me from employment to enjoyment. From confinement to refinement. From a cubicle to ... The only thing I can think of that rhymes with cubicle is icicle but those books did not take me there.
Oh well. Go read those books. The people who listen to what this man has to say are the people who will survive in the new economy that we find ourselves in.
I don't know if you've noticed this or not but companies are no longer taking care of their employees; pensions are a thing of the past.
The government is not a viable option for security or wealth; social security is headed for bankruptcy and government cheese isn't fit for rats (actually yes it is. The rat race. Get it? Ha!).
401k's are about as good a retirement plan as just putting it all on black on the roulette table. Anyone trying to retire in 2001 via 401k had to go back to work.
It is all up to you now, my friend. It is up to you to provide a secure future for you and your family. There is no more security. There is no more leaning on your employer to take care of you (do you really want that anyways - your future in someone else's hands?). How are you going to do it? What is your plan?
Forget about mere surviving and being able to retire for a second. Do you have a plan to be wealthy? True wealth - The ability to choose when, where, and how much you work (if at all) while living the lifestyle you want. Very difficult to accomplish as an employee. Very difficult indeed.
My first sales job was selling steak and seafood out of the back of a truck during my senior year of high school. I was 17. That was fun. Next it was selling a $1,700 vacuum cleaner door to door that same year. More fun! After I graduated high school I partied professionally and worked at a BBQ restaurant in my spare time. A millionaire in the making. It was plain for all to see.
I spent my first 10 professional years as an employee of a financial brokerage owned by a life long friend of mine (now my father-in-law) who gave me a break. I started out making $4 an hour as the office do-boy (great break huh?) and ended up doing pretty well. Life was good.
But life suddenly got not good. I was spending more than I was making. I was bored with my job. There had to be something more. This couldn't be all life had to offer. 9 to 5. Chit chatting at the water cooler. Kissing butt. Policies. Boring meetings that on a scale of 1 to 10 on making me want to end my life violently ranked a 17 at least.
I kept talking myself into staying because I was doing well and had no college education. I didn't know I could do anything else. I was scared to death of not being under the wing of a company, which kept me from starting my own business.
Enter ... Rich Dad Poor Dad.
I'm pretty sure that book is what changed it all for me. I started believing that I could do something on my own. Without a boss. I started looking into both of the industries which Kiyosaki espouses in his books - real estate and network marketing.
In this book we will be dealing strictly with real estate. Visit here for more information on the absolute BEST and ONLY network marketing company worth getting involved with (You'll leave me in your wills for this one).
Folks, the people who subscribe to the Rich Dad Poor Dad mentality are the people who will survive and thrive in this new information age we find ourselves in. Real estate and network marketing - That's where it's at. There's no other place you'd rather be.
It's only been a couple years since exiting the rat race. I paid my dues and now I have over 50 real estate students that I coach and do business with on a routine basis. People bring wholesale deals to my desk every day without my having to lift a finger. I earn an extra above-average year's salary from my network marketing business, and the time to start flying around the world speaking and encouraging others has begun. If you really want to, and if your natural gifts allow for it ... You can do the same thing.
Since the day I finally quit, got involved in real estate and network marketing, and made $50,000 my first month of "unemployment" I have been in absolute heaven on earth.
1.no more meetings
2.no more rules (except for those I put in place for myself)
3.no more boss
4.no more traffic
5.no more office monkey ball tournaments (that's actually a negative because those were pretty fun. Shirts versus skins. We had a lenient boss I'll be the first to admit. But it still sucked because sometimes he would make us put our shirts back on because the receptionist couldn't stop drooling. Never mind.)
6.all the free time I want. I work when I want and how I want.
7.More cash than I had ever thought possible. Money is no longer an issue.
Real freedom. The way life was intended. Do you want it?
How bad?
Go to www.learntowholesale.com for more details (if you really need more details) and click one of the order buttons. You'll be devouring this priceless information like smoked squirrel on Thanksgiving immediately. What? Was the squirrel thing just my family? Dang it. I always knew I was raised weird.
To Your Freedom,
R. Pres$ton Ely
www.realfreedominc.com
© 2007 R. Preston Ely (Don't steal my stuff.)
All rights reserved
P.S. My e-book has been given rave reviews by industry GIANTS Mike Collins, Kenny Rushing, Heather Seitz and many more. My students and I are part of an elite group of investors actually capitalizing on the current 2007 real estate market. Now it's your turn!
P.P.S. Don't miss out on all the free bonuses that come with the digital book!
Real Freedom Inc.-Do Not Send Returns to This Address
PO BOX 48617
Tampa, FL
33646
US
If you no longer wish to receive communication from us:
Cancel
To update your contact information:
Update
Today you're getting the entire introduction for absolutely no charge. I'm getting a little tired of typing that word FREE. I'd much rather start typing the word 10 MILLION DOLLARS. Man I just had a fantastic idea. I'm giving you 2 more days to buy this book, and then I'm raising the price to 10 MILLION DOLLARS. If that's not incentive I don't know what is. Enjoy ...
Introduction
Dang I hated school. Hated homework. Hated gym class. Hated getting beat up by football players every time I did the littlest thing (like take their girlfriends by accident). School just wasn't for me. I always knew I would not be going to college. My friends in high school used to ridicule me for not aspiring to higher education. They couldn't comprehend why on earth I wasn't following all of them with every little thing they did.
They just didn't get it.
Well, they started comprehending and "getting it" when I rolled up in my Lexus complete with 18" rims and sound system at age 21 while they were still in school living off mommy and daddy. And they definitely get it now that they see the 745 with 22" rims I've upgraded to and the waterfront penthouse I live in.
They get it so well that some of them have signed up as my students. They have the college degrees, but they are now learning at my feet the true ways of the world of money which school unfortunately just does not teach.
By the way I'm not bragging with the whole 745/penthouse thing. Its just stuff; you could take it from me and I'd be just as happy (I think. Please don't test me on that, God!) I'm just setting the stage is all. Painting a picture if you will.
Now, I am not bashing school whatsoever. Some people need it. Doctors need it. Attorneys need it. Plenty of worthy professions which this world would suck without need organized education. I'll probably even recommend to my kids that they go to college ... But I won't force them to.
Not everyone is cut out for it, and not everyone needs it. I'd be more of an advocate if they would just teach what we really need - life skills!
Have any of you read Rich Dad Poor Dad? Well go read the entire series. They will change your life. They changed mine. They took me from employment to enjoyment. From confinement to refinement. From a cubicle to ... The only thing I can think of that rhymes with cubicle is icicle but those books did not take me there.
Oh well. Go read those books. The people who listen to what this man has to say are the people who will survive in the new economy that we find ourselves in.
I don't know if you've noticed this or not but companies are no longer taking care of their employees; pensions are a thing of the past.
The government is not a viable option for security or wealth; social security is headed for bankruptcy and government cheese isn't fit for rats (actually yes it is. The rat race. Get it? Ha!).
401k's are about as good a retirement plan as just putting it all on black on the roulette table. Anyone trying to retire in 2001 via 401k had to go back to work.
It is all up to you now, my friend. It is up to you to provide a secure future for you and your family. There is no more security. There is no more leaning on your employer to take care of you (do you really want that anyways - your future in someone else's hands?). How are you going to do it? What is your plan?
Forget about mere surviving and being able to retire for a second. Do you have a plan to be wealthy? True wealth - The ability to choose when, where, and how much you work (if at all) while living the lifestyle you want. Very difficult to accomplish as an employee. Very difficult indeed.
My first sales job was selling steak and seafood out of the back of a truck during my senior year of high school. I was 17. That was fun. Next it was selling a $1,700 vacuum cleaner door to door that same year. More fun! After I graduated high school I partied professionally and worked at a BBQ restaurant in my spare time. A millionaire in the making. It was plain for all to see.
I spent my first 10 professional years as an employee of a financial brokerage owned by a life long friend of mine (now my father-in-law) who gave me a break. I started out making $4 an hour as the office do-boy (great break huh?) and ended up doing pretty well. Life was good.
But life suddenly got not good. I was spending more than I was making. I was bored with my job. There had to be something more. This couldn't be all life had to offer. 9 to 5. Chit chatting at the water cooler. Kissing butt. Policies. Boring meetings that on a scale of 1 to 10 on making me want to end my life violently ranked a 17 at least.
I kept talking myself into staying because I was doing well and had no college education. I didn't know I could do anything else. I was scared to death of not being under the wing of a company, which kept me from starting my own business.
Enter ... Rich Dad Poor Dad.
I'm pretty sure that book is what changed it all for me. I started believing that I could do something on my own. Without a boss. I started looking into both of the industries which Kiyosaki espouses in his books - real estate and network marketing.
In this book we will be dealing strictly with real estate. Visit here for more information on the absolute BEST and ONLY network marketing company worth getting involved with (You'll leave me in your wills for this one).
Folks, the people who subscribe to the Rich Dad Poor Dad mentality are the people who will survive and thrive in this new information age we find ourselves in. Real estate and network marketing - That's where it's at. There's no other place you'd rather be.
It's only been a couple years since exiting the rat race. I paid my dues and now I have over 50 real estate students that I coach and do business with on a routine basis. People bring wholesale deals to my desk every day without my having to lift a finger. I earn an extra above-average year's salary from my network marketing business, and the time to start flying around the world speaking and encouraging others has begun. If you really want to, and if your natural gifts allow for it ... You can do the same thing.
Since the day I finally quit, got involved in real estate and network marketing, and made $50,000 my first month of "unemployment" I have been in absolute heaven on earth.
1.no more meetings
2.no more rules (except for those I put in place for myself)
3.no more boss
4.no more traffic
5.no more office monkey ball tournaments (that's actually a negative because those were pretty fun. Shirts versus skins. We had a lenient boss I'll be the first to admit. But it still sucked because sometimes he would make us put our shirts back on because the receptionist couldn't stop drooling. Never mind.)
6.all the free time I want. I work when I want and how I want.
7.More cash than I had ever thought possible. Money is no longer an issue.
Real freedom. The way life was intended. Do you want it?
How bad?
Go to www.learntowholesale.com for more details (if you really need more details) and click one of the order buttons. You'll be devouring this priceless information like smoked squirrel on Thanksgiving immediately. What? Was the squirrel thing just my family? Dang it. I always knew I was raised weird.
To Your Freedom,
R. Pres$ton Ely
www.realfreedominc.com
© 2007 R. Preston Ely (Don't steal my stuff.)
All rights reserved
P.S. My e-book has been given rave reviews by industry GIANTS Mike Collins, Kenny Rushing, Heather Seitz and many more. My students and I are part of an elite group of investors actually capitalizing on the current 2007 real estate market. Now it's your turn!
P.P.S. Don't miss out on all the free bonuses that come with the digital book!
Real Freedom Inc.-Do Not Send Returns to This Address
PO BOX 48617
Tampa, FL
33646
US
If you no longer wish to receive communication from us:
Cancel
To update your contact information:
Update
Cashflows Note Buyer
Lesson VI
We're in the home stretch, Mary
I hope you did your homework! If you didn't, unfortunately there's
no way to make you stay after school. But to get the most out of
this course, I do strongly suggest that you study both the lessons
and the homework. Here's what you should be reading now
(found at http://www.cashflows.org):
5 Things A Successful Note Buyer Must Have, by Jon Richards
(This is in the section entitled "Especially For Beginners"
Mortgage Transaction Checklist
Sample Letter To Note Seller Requesting Documents
Note Purchase Contract
How To Fill Out The Note Purchase Contract
Note Seller's Representations & Warranties
(These are in the section entitled "Contracts and Forms")
The above, along with the note intake worksheet that I gave you
in a previous lesson, are the basic documents you will need to buy
notes. It doesn't matter if you are planning to broker notes or
keep them for investment, you will still use these documents.
There are others you might use. For example, if you buy part of
a note (and you will), you will need a contract to do that. It's
different from the Note Purchase Contract, above. Other situations
will call for other documents. You can download what you need at
www.cashflows.org
To this point in the course -- which follows the steps in a note
purchase -- we have learned a lot about how the note business
works, finding notes, screening them for marketability and negotiation
with note holders. In the previous lesson we began to study what
documentation we will need. Some of it comes from the note seller
(such as copies of the note and mortgage or trust deed, property deed,
settlement statement, proofs of payment, etc.), some of it comes
from the courthouse (lien searches and documents that the seller
can't find) and some of it is generated fresh (credit reports on the
payor, appraisal, etc.)
------------------------------------------------------------
Lonnie, after reading your two books, I went out looking for
one mobile home and wound up buying a 250 unit park. Paid $450,000
for it and I truly believe it will be worth at least a million
after I get it filled. I've been a CPA for 15 years and have never
seen any deal like this. (Update-The park is filled and I'm getting
$215 rent per lot and I'm no longer a CPA. Thanks so much!)
B.R. Wichita Falls, TX
Lonnie's techniques have worked for thousands.
http://papersourceonline.com/e-books-more/deals-on-wheels/
http://papersourceonline.com/e-books-more/make-w-mobile-homes/
------------------------------------------------------------
Now let's finish the documentation process with Delbert Ashby:
The next items on our documentation check-list pertain to the
underlying senior debt (if any). We will want a copy of the note and
security instrument (such as the mortgage or deed of trust for that
debt. We will want to confirm that the amounts, terms, conditions
and outstanding balances for that debt are as we have been told.
(Some notes allow for extra debt to be added after some paydown has
happened over a period of time.)
Of special interest will be whether it has a due on sale clause,
terms under which the loan can be called and, from your point of
view if you are an investor, what happens if it is called.
What are your remedies and options to protect your position?
You will also want to check for any terms that might influence
your position even if all the debts are performing.
Think about the subordination clauses mentioned in our last
lesson. What other things could be lurking around to cause us a
problem? Don't be afraid of potential problems, just be aware of
them and know what they mean. They could become opportunities.
All we really have to do is to make sure we READ AND UNDERSTAND
EVERYTHING!! These documents will also tell us the lender's name,
loan number, where his debt is recorded, who to contact and much
more. There will be several times and several reasons why we may
want to contact that lender over a period of time.
SENIOR DEBT STATUS VERIFICATION
If you are buying a second mortgage or trust deed, the next item
is the senior debt status verification letter.
This is where we get in touch with the senior debt holder to
confirm that the payments on that debt are and have been current
and that the outstanding balance is as reported to us.
Yes, people have been known to make payments on the "small second"
mortgage and be in default on the first. Clearly, we would not
want to bu*y a second with the first in default. The reason we
want to confirm the current balance is that this could affect
our lo*an to value ratio/exposure and lead to future disagreements.
Maybe some extra debt has been negotiated with the current lender
or maybe some back payments or interest have been added to the
balance. In addition, this is certainly going to tell us something
about the payor's current financial condition. In any case, we need
to know.
PAYOR ESTOPPEL AFFIDAVIT
Next on our list is the PAYOR ESTOPPEL AFFIDAVIT. The purpose of
this is to get the payor to acknowledge that the mortgagor agrees
that he owes what we have been told that he owes and to STOP
future possible disagreement on those points. They are effectively
told that if they don't agree with the facts as stated, tell me
now or "don't come back to me later" and say that things were
different at the time we bought the note than was stated.
CREDIT APPROVAL
Next is CREDIT APPROVAL. This means that we should have received
the credit report and should have evaluated it. In addition,
if a credit application has been submitted (as in buying right
after settlement) we should verify everything on the report.
But remember that our ultimate recourse is the property.
The credit information does help us in the resale of notes
since others may put more emphasis on the payor than we do.
The credit history will certainly affect the price we for which
we can resell the note.
Del's book, "Make Money Trading Mortgages," is indispensable for
any note broker:
http://papersourceonline.com/e-books-more/start-here/
------------------------------------
Can You Order a Credit Report on a Note Payor Without His Consent?
by Lorelei Stevens, President, Wall Street Brokers, Inc.
This question has haunted note brokers and investors for years.
The answer appears to be "yes."
Section 604 (a) (3) (E) of the federal Fair Credit Reporting Act
"FCRA") states that a permissible purpose is given to a person who:
"intends to use the information, as a potential invest*or or servicer,
or current insurer, in connection with a valuation of, or an
assessment of the credit or prepayment risks associated with,
an existing credit obligation, "
Therefore, this section gives a permissible purpose for potential
investors, servicers or insurers of credit obligations to obtain a
report on a payor for the purpose of evaluating or assessing the
credit or prepayment risks involved in existing credit obligations
of the payor.
For example, an entity which plans to buy a note and trust deed
would have a permissible purpose under this section to obtain a
consumer report on the payor for that particular transaction.
I have verified this information with my attorney and with the
Federal Trade Commission. However, your own attorney should be
consulted regarding this matter for legal advice.
Here is the Associated Credit Bureau's analysis:
"Section 604(a)(3)(E) creates a permissible purpose for potential
investors, servicers or insurers of credit obligations to obtain
consumer reports for the purpose of evaluating or assessing the
credit or prepayment risks involved in existing credit obligations
of consumers.
"For example, an entity that plans to invest in a mortgage loan
transaction would have a permissible purpose under this section
to obtain a consumer report on the borrower in that transaction."
Lorelei Stevens is president of Wall Street Brokers, Inc. in Seattle,
Washington. If you have a note to sell, please contact her at
206-448-1160 or fax 206-448-8476 or e-mail lorelei@eskimo.com
Website: www.wallstreetbrokers.com
I can't say enough good things about Lorelei's book "Lorelei's
Legal Lessons," and neither can some of the top people in the
note business. See for yourself at
http://papersourceonline.com/e-books-more/essential-guid/
**********************************************
"You may remember me: I called you from a ship in the Middle East,
in the Gulf of Oman, to renew my subscription to THE PAPER SOURCE
JOURNAL..."
-- David B. Guest, Old Orchard Beach, Maine
INTERNET SPECIAL: $40 off a year's subscription to THE PAPER SOURCE
JOURNAL! Only $79. Includes BONUS: The Registry of Note
Investors -- who buys notes, what they buy and how to contact them.
http://papersourceonline.com/paper-source-journal/infosubscribe/
***********************************************
P & L STATEMENT
The P & L (Profit and Loss) statement applies primarily to
investor-owned or commercial properties. We would want to see a
P & L statement on the properties because a property of this type
is expected to produce the revenues to make its own payments.
If we had to take the property back, we would want to know that
it could pay its own way AND that we would know how to operate
the property to make it pay. Since this will not apply to most
notes we would personally hold, I will not elaborate further here.
Now we have covered the first 16 items on our documentation
checklist. This completes all of the documents we need to allow us
to make our purchase decision and to schedule settlement.
It's time to instruct the settlement agent (a title company or
attorney) how you want settlement handled. These instructions
will vary from case to case, depending upon whether you are
keeping or brokering the note.
Let's assume you are brokering. You simply tell them you are
buying a note from party "A" and simultaneously reselling it to
party "B." Give them these instructions:
1. You want separate but simultaneous closings. You do not want
either party to know who the other party is since they might
decide to go around you in future transactions.
2. Your purchaser's money will fund the transaction. Thus, the
purchaser's funds must be in escrow AND authorized for distribution
before settlement.
3. You require a double recordation with your ownership recorded
before the resale to your investor is recorded. This means that
you actually own the note before you resell it.
4. You want to be sure that your purchaser's requirements are
fully met before closing so that there will be no complications
to cause your purchaser not to settle as scheduled.
5. Per the contract, funds to the seller are not to be disbursed
until proof of recordation of the resale to the note investor has
been received.
6. Ask the settlement agent to coordinate the closing by being in
touch with all parties and to let me know if anything else is
needed and/or is delaying settlement.
7. You should let the settlement agent know of any other documents
you require at settlement (such as title insurance, affidavits, etc.)
so they will have adequate time to respond. If you want them to
handle post-closing activities beyond the norm, mention that at
this time. Beyond the above items (or anything special to your case),
the settlement agent should know how to handle the rest.
Delbert Ashby has been involved in notes longer than some note
investors and brokers have been alive. He authored the book,
"Make Mon ey Trading Mortgages," which is the best written
explanation of the note brokering business available:
A comprehensive, quality 145-page book that will teach you what
a note broker needs to know. It is available as an e-book for just
$19.95, and you get it immediately:
http://papersourceonline.com/e-books-more/start-here/
Thanks to Del Ashby for his wonderful contributions to this course,
to THE PAPER SOURCE JOURNAL and to the note industry.
Now, back to my comments (WJM):
While it's vital that you know all about the paperwork needed for
a note transaction, you may be thinking, "man, what a hassle!" And
you are right.
I'd like to end this lesson with some observations on what makes a
good mortgage or trust deed. I wrote it a few years ago and have
made updates to it as necessary. I think it is a pretty good summary
of the factors that make some notes more valuable than others.
Remember, I wrote the following with private investors in mind. Let
me make two exceptions:
(1) You can broker a lot of notes that you shouldn't own. When I
write something like, "a second lien note with a huge balance first
lien should be avoided," I don't mean you should avoid BROKERING
such a note. There are institutional investment firms that
specialize in all sorts of off-the-midway paper and it's fine to
broker notes to them that you would never even consider owning
yourself. In fact, that is EXACTLY what you should do with the
majority of the notes that cross your desk.
(2) When I write things like, "these notes aren't as desirable as
others," or "stick to these notes" for investment, I am assuming
you are fairly new at this. More experienced private investors
in notes may want to branch out into other areas that would
be too risky for beginning investors.
Someone once criticized me for printing some "rules of note
investment." They said, "Whose 'rules'? Yours? Give me a break."
My answer to that is,
(1) What rule isn't written by somebody? (With the exception of
God'slaws, of course). There's nothing wrong with someone writing
"rules." What you have to examine is whether the person is
qualified, by their own knowledge and experience, to offer "rules."
In other words, have they earned the right?
(2) "Rules" are simply suggestions. OK, strong suggestions!
(3) They are based on my over 25 years of buying notes and editing
THE PAPER SOURCE since 1987, a journal in which the brightest,
most experienced note investors and brokers share their wisdom.
(4) Finally, yes, it's my opinion. It's the only one I'm qualified
to give.
Here we go:
**The value of a note depends ultimately on the economic conditions
that support the value of the property.**
An owner-occupied single family house in a good neighborhood located
in an area with a long-term stable economy is the best collateral
possible. Among other reasons, that is because single family houses
have a better appreciation track record than any other type of
property. A note on the above is further enhanced by a payor who
has an excellent credit record and unblemished payment history.
Less desirable collateral, in descending order: owner-occupied
(owner lives in 1 unit) duplexes/triplexes; non-owner-occupied
single family houses; non-owner-occupied duplexes/triplexes;
other non-owner-occupied multi-family units; improved land;
commercial (non-industrial) properties; resort properties;
subdivided but unimproved lots; raw land (some buyers would use a
slightly different hierarchy).
Due to the current regulatory environment in the U.S.,
industrial properties, gasoline stations, even properties with
underground oil tanks have many hidden liabilities. Notes secured
by such properties should be avoided.
Cooperatives, time-shares, mobile homes without land, business notes
without real estate, signature loans, viaticals (insurance policies
on terminally ill persons), senior settlements, are not adequate
security as notes in your personal portfolio. There are investors
for many of these notes, however, and you can certainly broker them.
I advise you to steer clear of viaticals and senior settlements, both
for your own investment and even to broker. There is a great deal of
fraud in these instruments, and states (such as California) are ruling
them to be securities.
Speaking of fraud, so-called "prime bank notes," "prime bank
guarantees," and similarly-titled "investments" do not exist.
They are complete frauds, total scams. "Letters of credit,"
while they exist, are not transferable and thus cannot
be bought and sold. If someone tries to convince you otherwise,
run the other way. They are crooks.
The higher the investment-to-value ratio (ITV), the riskier the note.
(ITV = amount paid for the note + senior lien balance (if any)
divided by the market value of the property).
A deep discount on a note does not make it pay better. (Thanks to Jim
Levie for reminding me of that fact).
If there is little or no appreciation in the property, the
loan-to-value ratio (LTV) is a barometer of the likelihood of
default. (LTV = balance of all loans against the property divided by
the market value of the property).
Notes on property purchased for $1,000 down or less often default.
The higher the down payment, the better.
An amortized note is more valuable than one with a balloon, since
the payor may not be able to make the balloon payment.
The single most powerful financial aspect determining the value of
a note is the amount of the monthly payment. For example, all else
being equal, a 10-year note with a large monthly payment and no
balloon is worth more than a 10 year note with a smaller monthly
payment and a balloon.
A note in the first lien position is more valuable than one in the
second lien position. Third lien or lower notes are worth very
little.
A second lien note with a huge balance first lien should be avoided.
In case of foreclosure, the owner of the second lien would have to
make the payments on the first.
A seasoned note (one with a payment history of several years or more)
is better than a green note (little or no payment history).
The payor's credit history is important to help determine the
character of the payor and likelihood of default, but it is not
infallible. Everyone, even those with the best credit, can lose
their incomes, have medical emergencies or suffer other unforeseen
catastrophes. The best use of a credit report is to identify a
potential bankruptcy candidate.
A second note behind an assumable first is always to be preferred
over one behind a non-assumable first.
**Again: The value of a note depends ultimately on the economic
conditions that support the value of the property.**
This is not a complete list, but it is most of the crucial
factors to weigh when considering a note for investment.
Your suggested homework is at www.cashflows.org The topic area
for the articles is in the parenthesis:
What Being A "Broker" Really Means
The #1 Broker For The #1 Volume Investor Shares His Secrets
(Especially For Beginners)
Brokers At The Crossroad: The Return of the Private Investor
(Hot Issues)
Next Thursday you'll receive Lesson VII of How To Get Started
Profiting From Notes, so please watch for it in your e-mailbox.
May the Lord richly bless you,
W. J. Mencarow
Editor of THE PAPER SOURCE JOURNAL
www.PaperSourceOnline.com
P.S. I personally hand-picked the materials for THE COMPLETE
PACKAGE, comprehensive training for note brokers and investors.
You'll get training from people who measure their experience in
the note business in decades, not months.
You'll get in digital downloads:
* Make Money Trading Mortgages by Del Ashby. The best introductory
book on note brokering.
* How To Get Started Profiting From Notes by me, W. J. Mencarow.
* The Paper Source Registry Of Note Investors -- All the investors
you'll ever need and what they want to buy, updated frequently on
the Internet.
* Almost Everything That Could Possibly Go Wrong With A Note (and
how to prevent it!) by yours truly.
* The Paper Source's Own Contracts, Worksheets, Checklists, Forms &
Sample Letters -- Every essential document you must have for your
note business.
* 50 Contracts And Forms For Notes And Real Estate -- Advanced
documents when you need them.
* Lorelei's Legal Lessons -- The Essential Guide For Note Brokers
by Lorelei Stevens, President of Wall St. Brokers.
* One-year subscription to THE PAPER SOURCE JOURNAL.
Plus this incredible bonus -- EVERYTHING IN THE CASH FLOW DOLLAR
STORE!!
That's right! You'll receive over 300 profit-centered articles,
contracts, forms and sample letters, all written by the most
successful note brokers and investors. You'll get all the
invaluable information in these categories:
* How To Find Notes
* Especially For Beginners
* Negotiation
* Wealth-Building Strategies
* Note Niches (cash flows other than real estate notes)
* The Art of the Deal
* Hot Issues!
* Forms and Contracts
(to see all you will get in this bonus, go to www.cashflows.org)
Purchased separately all this would cost you almost $500.00.
Buy The Complete Package and they are yours for $199.95!
Why is it so inexpensive? We don't do costly infomercials,
telemarketing, etc., and we don't have fancy offices and a big
staff, so we can charge much less. Plus, you get this huge savings
because (except for THE PAPER SOURCE JOURNAL) all the materials
come to you as a digital download. Save all the files to your hard
disk and read or print them when you need them.
THE COMPLETE PACKAGE has everything you need to profit from notes
as a broker or investor in notes. Whether you are just getting
started or are a note veteran, you can't afford to pass up The
Complete Package.
Get started immediately! Go to:
http://papersourceonline.com/the-complete-package/m
*******************************************************
We're in the home stretch, Mary
I hope you did your homework! If you didn't, unfortunately there's
no way to make you stay after school. But to get the most out of
this course, I do strongly suggest that you study both the lessons
and the homework. Here's what you should be reading now
(found at http://www.cashflows.org):
5 Things A Successful Note Buyer Must Have, by Jon Richards
(This is in the section entitled "Especially For Beginners"
Mortgage Transaction Checklist
Sample Letter To Note Seller Requesting Documents
Note Purchase Contract
How To Fill Out The Note Purchase Contract
Note Seller's Representations & Warranties
(These are in the section entitled "Contracts and Forms")
The above, along with the note intake worksheet that I gave you
in a previous lesson, are the basic documents you will need to buy
notes. It doesn't matter if you are planning to broker notes or
keep them for investment, you will still use these documents.
There are others you might use. For example, if you buy part of
a note (and you will), you will need a contract to do that. It's
different from the Note Purchase Contract, above. Other situations
will call for other documents. You can download what you need at
www.cashflows.org
To this point in the course -- which follows the steps in a note
purchase -- we have learned a lot about how the note business
works, finding notes, screening them for marketability and negotiation
with note holders. In the previous lesson we began to study what
documentation we will need. Some of it comes from the note seller
(such as copies of the note and mortgage or trust deed, property deed,
settlement statement, proofs of payment, etc.), some of it comes
from the courthouse (lien searches and documents that the seller
can't find) and some of it is generated fresh (credit reports on the
payor, appraisal, etc.)
------------------------------------------------------------
Lonnie, after reading your two books, I went out looking for
one mobile home and wound up buying a 250 unit park. Paid $450,000
for it and I truly believe it will be worth at least a million
after I get it filled. I've been a CPA for 15 years and have never
seen any deal like this. (Update-The park is filled and I'm getting
$215 rent per lot and I'm no longer a CPA. Thanks so much!)
B.R. Wichita Falls, TX
Lonnie's techniques have worked for thousands.
http://papersourceonline.com/e-books-more/deals-on-wheels/
http://papersourceonline.com/e-books-more/make-w-mobile-homes/
------------------------------------------------------------
Now let's finish the documentation process with Delbert Ashby:
The next items on our documentation check-list pertain to the
underlying senior debt (if any). We will want a copy of the note and
security instrument (such as the mortgage or deed of trust for that
debt. We will want to confirm that the amounts, terms, conditions
and outstanding balances for that debt are as we have been told.
(Some notes allow for extra debt to be added after some paydown has
happened over a period of time.)
Of special interest will be whether it has a due on sale clause,
terms under which the loan can be called and, from your point of
view if you are an investor, what happens if it is called.
What are your remedies and options to protect your position?
You will also want to check for any terms that might influence
your position even if all the debts are performing.
Think about the subordination clauses mentioned in our last
lesson. What other things could be lurking around to cause us a
problem? Don't be afraid of potential problems, just be aware of
them and know what they mean. They could become opportunities.
All we really have to do is to make sure we READ AND UNDERSTAND
EVERYTHING!! These documents will also tell us the lender's name,
loan number, where his debt is recorded, who to contact and much
more. There will be several times and several reasons why we may
want to contact that lender over a period of time.
SENIOR DEBT STATUS VERIFICATION
If you are buying a second mortgage or trust deed, the next item
is the senior debt status verification letter.
This is where we get in touch with the senior debt holder to
confirm that the payments on that debt are and have been current
and that the outstanding balance is as reported to us.
Yes, people have been known to make payments on the "small second"
mortgage and be in default on the first. Clearly, we would not
want to bu*y a second with the first in default. The reason we
want to confirm the current balance is that this could affect
our lo*an to value ratio/exposure and lead to future disagreements.
Maybe some extra debt has been negotiated with the current lender
or maybe some back payments or interest have been added to the
balance. In addition, this is certainly going to tell us something
about the payor's current financial condition. In any case, we need
to know.
PAYOR ESTOPPEL AFFIDAVIT
Next on our list is the PAYOR ESTOPPEL AFFIDAVIT. The purpose of
this is to get the payor to acknowledge that the mortgagor agrees
that he owes what we have been told that he owes and to STOP
future possible disagreement on those points. They are effectively
told that if they don't agree with the facts as stated, tell me
now or "don't come back to me later" and say that things were
different at the time we bought the note than was stated.
CREDIT APPROVAL
Next is CREDIT APPROVAL. This means that we should have received
the credit report and should have evaluated it. In addition,
if a credit application has been submitted (as in buying right
after settlement) we should verify everything on the report.
But remember that our ultimate recourse is the property.
The credit information does help us in the resale of notes
since others may put more emphasis on the payor than we do.
The credit history will certainly affect the price we for which
we can resell the note.
Del's book, "Make Money Trading Mortgages," is indispensable for
any note broker:
http://papersourceonline.com/e-books-more/start-here/
------------------------------------
Can You Order a Credit Report on a Note Payor Without His Consent?
by Lorelei Stevens, President, Wall Street Brokers, Inc.
This question has haunted note brokers and investors for years.
The answer appears to be "yes."
Section 604 (a) (3) (E) of the federal Fair Credit Reporting Act
"FCRA") states that a permissible purpose is given to a person who:
"intends to use the information, as a potential invest*or or servicer,
or current insurer, in connection with a valuation of, or an
assessment of the credit or prepayment risks associated with,
an existing credit obligation, "
Therefore, this section gives a permissible purpose for potential
investors, servicers or insurers of credit obligations to obtain a
report on a payor for the purpose of evaluating or assessing the
credit or prepayment risks involved in existing credit obligations
of the payor.
For example, an entity which plans to buy a note and trust deed
would have a permissible purpose under this section to obtain a
consumer report on the payor for that particular transaction.
I have verified this information with my attorney and with the
Federal Trade Commission. However, your own attorney should be
consulted regarding this matter for legal advice.
Here is the Associated Credit Bureau's analysis:
"Section 604(a)(3)(E) creates a permissible purpose for potential
investors, servicers or insurers of credit obligations to obtain
consumer reports for the purpose of evaluating or assessing the
credit or prepayment risks involved in existing credit obligations
of consumers.
"For example, an entity that plans to invest in a mortgage loan
transaction would have a permissible purpose under this section
to obtain a consumer report on the borrower in that transaction."
Lorelei Stevens is president of Wall Street Brokers, Inc. in Seattle,
Washington. If you have a note to sell, please contact her at
206-448-1160 or fax 206-448-8476 or e-mail lorelei@eskimo.com
Website: www.wallstreetbrokers.com
I can't say enough good things about Lorelei's book "Lorelei's
Legal Lessons," and neither can some of the top people in the
note business. See for yourself at
http://papersourceonline.com/e-books-more/essential-guid/
**********************************************
"You may remember me: I called you from a ship in the Middle East,
in the Gulf of Oman, to renew my subscription to THE PAPER SOURCE
JOURNAL..."
-- David B. Guest, Old Orchard Beach, Maine
INTERNET SPECIAL: $40 off a year's subscription to THE PAPER SOURCE
JOURNAL! Only $79. Includes BONUS: The Registry of Note
Investors -- who buys notes, what they buy and how to contact them.
http://papersourceonline.com/paper-source-journal/infosubscribe/
***********************************************
P & L STATEMENT
The P & L (Profit and Loss) statement applies primarily to
investor-owned or commercial properties. We would want to see a
P & L statement on the properties because a property of this type
is expected to produce the revenues to make its own payments.
If we had to take the property back, we would want to know that
it could pay its own way AND that we would know how to operate
the property to make it pay. Since this will not apply to most
notes we would personally hold, I will not elaborate further here.
Now we have covered the first 16 items on our documentation
checklist. This completes all of the documents we need to allow us
to make our purchase decision and to schedule settlement.
It's time to instruct the settlement agent (a title company or
attorney) how you want settlement handled. These instructions
will vary from case to case, depending upon whether you are
keeping or brokering the note.
Let's assume you are brokering. You simply tell them you are
buying a note from party "A" and simultaneously reselling it to
party "B." Give them these instructions:
1. You want separate but simultaneous closings. You do not want
either party to know who the other party is since they might
decide to go around you in future transactions.
2. Your purchaser's money will fund the transaction. Thus, the
purchaser's funds must be in escrow AND authorized for distribution
before settlement.
3. You require a double recordation with your ownership recorded
before the resale to your investor is recorded. This means that
you actually own the note before you resell it.
4. You want to be sure that your purchaser's requirements are
fully met before closing so that there will be no complications
to cause your purchaser not to settle as scheduled.
5. Per the contract, funds to the seller are not to be disbursed
until proof of recordation of the resale to the note investor has
been received.
6. Ask the settlement agent to coordinate the closing by being in
touch with all parties and to let me know if anything else is
needed and/or is delaying settlement.
7. You should let the settlement agent know of any other documents
you require at settlement (such as title insurance, affidavits, etc.)
so they will have adequate time to respond. If you want them to
handle post-closing activities beyond the norm, mention that at
this time. Beyond the above items (or anything special to your case),
the settlement agent should know how to handle the rest.
Delbert Ashby has been involved in notes longer than some note
investors and brokers have been alive. He authored the book,
"Make Mon ey Trading Mortgages," which is the best written
explanation of the note brokering business available:
A comprehensive, quality 145-page book that will teach you what
a note broker needs to know. It is available as an e-book for just
$19.95, and you get it immediately:
http://papersourceonline.com/e-books-more/start-here/
Thanks to Del Ashby for his wonderful contributions to this course,
to THE PAPER SOURCE JOURNAL and to the note industry.
Now, back to my comments (WJM):
While it's vital that you know all about the paperwork needed for
a note transaction, you may be thinking, "man, what a hassle!" And
you are right.
I'd like to end this lesson with some observations on what makes a
good mortgage or trust deed. I wrote it a few years ago and have
made updates to it as necessary. I think it is a pretty good summary
of the factors that make some notes more valuable than others.
Remember, I wrote the following with private investors in mind. Let
me make two exceptions:
(1) You can broker a lot of notes that you shouldn't own. When I
write something like, "a second lien note with a huge balance first
lien should be avoided," I don't mean you should avoid BROKERING
such a note. There are institutional investment firms that
specialize in all sorts of off-the-midway paper and it's fine to
broker notes to them that you would never even consider owning
yourself. In fact, that is EXACTLY what you should do with the
majority of the notes that cross your desk.
(2) When I write things like, "these notes aren't as desirable as
others," or "stick to these notes" for investment, I am assuming
you are fairly new at this. More experienced private investors
in notes may want to branch out into other areas that would
be too risky for beginning investors.
Someone once criticized me for printing some "rules of note
investment." They said, "Whose 'rules'? Yours? Give me a break."
My answer to that is,
(1) What rule isn't written by somebody? (With the exception of
God'slaws, of course). There's nothing wrong with someone writing
"rules." What you have to examine is whether the person is
qualified, by their own knowledge and experience, to offer "rules."
In other words, have they earned the right?
(2) "Rules" are simply suggestions. OK, strong suggestions!
(3) They are based on my over 25 years of buying notes and editing
THE PAPER SOURCE since 1987, a journal in which the brightest,
most experienced note investors and brokers share their wisdom.
(4) Finally, yes, it's my opinion. It's the only one I'm qualified
to give.
Here we go:
**The value of a note depends ultimately on the economic conditions
that support the value of the property.**
An owner-occupied single family house in a good neighborhood located
in an area with a long-term stable economy is the best collateral
possible. Among other reasons, that is because single family houses
have a better appreciation track record than any other type of
property. A note on the above is further enhanced by a payor who
has an excellent credit record and unblemished payment history.
Less desirable collateral, in descending order: owner-occupied
(owner lives in 1 unit) duplexes/triplexes; non-owner-occupied
single family houses; non-owner-occupied duplexes/triplexes;
other non-owner-occupied multi-family units; improved land;
commercial (non-industrial) properties; resort properties;
subdivided but unimproved lots; raw land (some buyers would use a
slightly different hierarchy).
Due to the current regulatory environment in the U.S.,
industrial properties, gasoline stations, even properties with
underground oil tanks have many hidden liabilities. Notes secured
by such properties should be avoided.
Cooperatives, time-shares, mobile homes without land, business notes
without real estate, signature loans, viaticals (insurance policies
on terminally ill persons), senior settlements, are not adequate
security as notes in your personal portfolio. There are investors
for many of these notes, however, and you can certainly broker them.
I advise you to steer clear of viaticals and senior settlements, both
for your own investment and even to broker. There is a great deal of
fraud in these instruments, and states (such as California) are ruling
them to be securities.
Speaking of fraud, so-called "prime bank notes," "prime bank
guarantees," and similarly-titled "investments" do not exist.
They are complete frauds, total scams. "Letters of credit,"
while they exist, are not transferable and thus cannot
be bought and sold. If someone tries to convince you otherwise,
run the other way. They are crooks.
The higher the investment-to-value ratio (ITV), the riskier the note.
(ITV = amount paid for the note + senior lien balance (if any)
divided by the market value of the property).
A deep discount on a note does not make it pay better. (Thanks to Jim
Levie for reminding me of that fact).
If there is little or no appreciation in the property, the
loan-to-value ratio (LTV) is a barometer of the likelihood of
default. (LTV = balance of all loans against the property divided by
the market value of the property).
Notes on property purchased for $1,000 down or less often default.
The higher the down payment, the better.
An amortized note is more valuable than one with a balloon, since
the payor may not be able to make the balloon payment.
The single most powerful financial aspect determining the value of
a note is the amount of the monthly payment. For example, all else
being equal, a 10-year note with a large monthly payment and no
balloon is worth more than a 10 year note with a smaller monthly
payment and a balloon.
A note in the first lien position is more valuable than one in the
second lien position. Third lien or lower notes are worth very
little.
A second lien note with a huge balance first lien should be avoided.
In case of foreclosure, the owner of the second lien would have to
make the payments on the first.
A seasoned note (one with a payment history of several years or more)
is better than a green note (little or no payment history).
The payor's credit history is important to help determine the
character of the payor and likelihood of default, but it is not
infallible. Everyone, even those with the best credit, can lose
their incomes, have medical emergencies or suffer other unforeseen
catastrophes. The best use of a credit report is to identify a
potential bankruptcy candidate.
A second note behind an assumable first is always to be preferred
over one behind a non-assumable first.
**Again: The value of a note depends ultimately on the economic
conditions that support the value of the property.**
This is not a complete list, but it is most of the crucial
factors to weigh when considering a note for investment.
Your suggested homework is at www.cashflows.org The topic area
for the articles is in the parenthesis:
What Being A "Broker" Really Means
The #1 Broker For The #1 Volume Investor Shares His Secrets
(Especially For Beginners)
Brokers At The Crossroad: The Return of the Private Investor
(Hot Issues)
Next Thursday you'll receive Lesson VII of How To Get Started
Profiting From Notes, so please watch for it in your e-mailbox.
May the Lord richly bless you,
W. J. Mencarow
Editor of THE PAPER SOURCE JOURNAL
www.PaperSourceOnline.com
P.S. I personally hand-picked the materials for THE COMPLETE
PACKAGE, comprehensive training for note brokers and investors.
You'll get training from people who measure their experience in
the note business in decades, not months.
You'll get in digital downloads:
* Make Money Trading Mortgages by Del Ashby. The best introductory
book on note brokering.
* How To Get Started Profiting From Notes by me, W. J. Mencarow.
* The Paper Source Registry Of Note Investors -- All the investors
you'll ever need and what they want to buy, updated frequently on
the Internet.
* Almost Everything That Could Possibly Go Wrong With A Note (and
how to prevent it!) by yours truly.
* The Paper Source's Own Contracts, Worksheets, Checklists, Forms &
Sample Letters -- Every essential document you must have for your
note business.
* 50 Contracts And Forms For Notes And Real Estate -- Advanced
documents when you need them.
* Lorelei's Legal Lessons -- The Essential Guide For Note Brokers
by Lorelei Stevens, President of Wall St. Brokers.
* One-year subscription to THE PAPER SOURCE JOURNAL.
Plus this incredible bonus -- EVERYTHING IN THE CASH FLOW DOLLAR
STORE!!
That's right! You'll receive over 300 profit-centered articles,
contracts, forms and sample letters, all written by the most
successful note brokers and investors. You'll get all the
invaluable information in these categories:
* How To Find Notes
* Especially For Beginners
* Negotiation
* Wealth-Building Strategies
* Note Niches (cash flows other than real estate notes)
* The Art of the Deal
* Hot Issues!
* Forms and Contracts
(to see all you will get in this bonus, go to www.cashflows.org)
Purchased separately all this would cost you almost $500.00.
Buy The Complete Package and they are yours for $199.95!
Why is it so inexpensive? We don't do costly infomercials,
telemarketing, etc., and we don't have fancy offices and a big
staff, so we can charge much less. Plus, you get this huge savings
because (except for THE PAPER SOURCE JOURNAL) all the materials
come to you as a digital download. Save all the files to your hard
disk and read or print them when you need them.
THE COMPLETE PACKAGE has everything you need to profit from notes
as a broker or investor in notes. Whether you are just getting
started or are a note veteran, you can't afford to pass up The
Complete Package.
Get started immediately! Go to:
http://papersourceonline.com/the-complete-package/m
*******************************************************
Monday, July 12, 2010
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