February 2020

Chess

Risk and Sacrifice

Flipping, Rentals, Uncategorized /

Risk is a part of investing. Without risk takers, America would not be where it is today. Real Estate Investing, Loan Investing, and Private Lending are no exceptions to that rule. It’s why the National Institute of Lending and Real Estate exists…to help investors build wealth while mitigating the downside risk to their portfolios as much as possible. Before you start your journey into the world of real estate-based investing, you need to understand that risk and sacrifice are a large part of our business.

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Neighborhood

Multiple Offers and “Highest and Best”

Flipping, Rentals, Uncategorized /

An investor asked us about a property that they were bidding on that had been on the market for several months. They made their offer only to be told by the listing agent that there were now multiple offers on the property and they wanted everyone’s highest and best offer by a certain date. The investor questioned whether there truly were multiple offers or not and what course of action they should take.

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Property Overhead Shot

Not All Deeds are Created the Same

Flipping, Lending, Non-Performing/Performing Loans, Rentals, Uncategorized /

Not all deeds are the same. When property is transferred, the language in each deed will provide certain warranties from the seller. It’s important to understand the types of deeds that are out there as you might not be getting the protections that you deserve with some deeds. In this article, we are going to discuss three common types of deeds and what they generally cover.

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Thumbs Up

The Prequalification Predicament

Flipping, Lending, Non-Performing/Performing Loans, Rentals, Uncategorized /

A prequalification letter from a lender isn’t worth the paper that its printed on. I know that sounds harsh, but it’s true. When you list that property for sale and you are trying to determine which offer you should choose, it’s not all about price. Close-ability is also a huge consideration. Can and will the prospective buyer actually sign the closing documents? Will their lender actually approve the deal?

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studying

Ten Challenges to Buying Notes

Non-Performing/Performing Loans, Uncategorized /

We recently explored several reasons why you should consider investing in notes. It can be a very lucrative place to invest, but investing in notes does have its challenges. These ten things that you must know shouldn’t be enough to keep you from considering buying notes, but you certainly should understand these ten items in order to build a thriving practice.

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Money

Why Buy Notes Over Real Estate?

Non-Performing/Performing Loans, Uncategorized /

When was first asked to speak about purchasing nonperforming loans at a national conference, people couldn’t wrap their heads around the concept of buying the mortgage on a property instead of owning the property itself. I was even laughed at by some of the real estate groups who were certain that I had lost my marbles. Fast forward a few years and no one is laughing now. As a matter of fact, many of the larger real estate funds have turned to note buying to provide them with a strong return.

Why Buy Notes Over Real Estate? Read More »

Change

Mind Your Nickels and Dimes

Flipping, Lending, Non-Performing/Performing Loans, Rentals, Uncategorized /

Perhaps the #1 factor that goes into making a profit or taking a loss is controlling your costs. Whether you are purchasing a nonperforming loan or a property to flip, it’s all about the math. Regardless of how well you rehab and present a property, you are still limited by the local market with respect to the amount you can sell the property for. Cost controls are essential for hitting your profit goals.

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Teaching

The Institute Announces New Programs

Flipping, Lending, Non-Performing/Performing Loans, Rentals, Uncategorized /

It’s hard to get started in real estate-based investing. You have to raise capital, form a business entity, find property or loan opportunities, find lenders, find contractors, find real estate agents, negotiate prices, and on and on. Where to begin or how to scale up can be confusing. It’s hard to figure out where to turn.

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Flower Bed

First Impressions Mean A Lot

Flipping, Uncategorized /

If you’ve ever searched for homes on line, you know the feeling of looking at the interior pictures of a property and falling in love with it, but when you pull up to the property itself, you cringe. First impressions mean a great deal. You can spend all you want on updating a property, but if the outside looks like the Munster’s home, you can be losing potential buyers before they even get through the front door.

First Impressions Mean A Lot Read More »

Fee Income

The 4 Ways that Lenders Make Money

Flipping, Lending, Non-Performing/Performing Loans, Rentals, Uncategorized /

It’s standard practice within the note industry to obtain a Broker’s Price Opinion, or BPO, to place a value on a property within an investor’s portfolio. When selling a note, it is expected from buyers that a BPO will be in the offering package, but how accurate are BPOs and do they add value to an investor when making a decision on buying a loan?

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Foreclosure

BPOs and Property Condition Reports

Flipping, Lending, Non-Performing/Performing Loans, Rentals, Uncategorized /

It’s standard practice within the note industry to obtain a Broker’s Price Opinion, or BPO, to place a value on a property within an investor’s portfolio. When selling a note, it is expected from buyers that a BPO will be in the offering package, but how accurate are BPOs and do they add value to an investor when making a decision on buying a loan?

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Money

The Good and Bad of Leverage

Flipping, Lending, Uncategorized /

Many, if not most people, dream of building financial independence through real estate investment. The vast majority of people that want to start investing don’t have enough money in the coffers to buy their first property outright. Banks usually aren’t willing to finance a fix-n-flipper or, as one banker put it, “a rental jockey.” Hard money is usually where people turn to start building their dream, but what is the impact of borrowing on real estate investments?

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IMN

Doug Smith Speaks at IMN Conference

Flipping, Lending, Non-Performing/Performing Loans, Rentals, Uncategorized /

The Institute’s own Doug Smith will be speaking this week at IMN’s “NPLs, Notes, and Default Servicing Forum” at the Ritz Carlton in Fort Lauderdale Florida on Monday, February 10th and Tuesday, February 11th. IMN is excited to return to Fort Lauderdale, Florida on February 10-11, for our next NPLs, Notes & Default Servicing Forum.

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Banker

Uncollectible Notes

Non-Performing/Performing Loans, Uncategorized /

Jane (not her real name) purchased a nonperforming loan where the borrower had not paid in years. She purchased it for a huge discount from the collateral value and immediately had her servicer try to work through the collection waterfall (see our previous article). When they got to the point of foreclosing, however, they learned that it was too late to foreclose on the property. How could this be?

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Courthouse

What is a “Lis Pendens”?

Lending, Non-Performing/Performing Loans /

I never took Latin in High School or College and I don’t regularly converse with Ancient Romans, but Latin terms seem to creep into my vocabulary whenever I am dealing with a foreclosure. Perhaps the most common term you will see in a foreclosure proceeding is the term “Lis Pendens”. What is a Lis Pendens anyway and what does it have to do with loan or real estate investment?

What is a “Lis Pendens”? Read More »