We want to throw out a quick thank you to our listeners. Your support has put us leaps and bounds ahead of our expectations for such an early stage in our podcast. iTunes treated us to a front row seat by putting us in the top 15 podcasts in their New & Noteworthy sections of Business, Education, and Technology this week.

We open the show with a highlight of a recently JV deal Robby completed in Miami with a return greater than expected and a timeframe shorter than expected. Check out the Case Study we have put together for our listeners to see how this deal went down.

Chase sits down with Joel Markovitz , VP of Business Development for Land Home Financial Services. Land Home, based out of Southern California is a mortgage service focused on serving the small investor or small hedge fund clients in the distressed asset market. Joel’s origin story begins working on Mods with the big boys like Citi while at M.O.S./NuView.

They saw changes in the marketplace and started looking towards the world of servicing defaulted notes from focusing on loan modifications for larger mortgage companies. Joel considers servicing to be the meat of your “note sandwich” though Chase prefers the Oreo analogy (by the way, how’s that goal of losing some lbs coming along Mr. Oreo?)

Joel hits on a great point that you don’t need to have a servicer service your loans, but when looking at a cost vs. liability perspective, if you’re not well versed in Dodd Frank and CFPB (WTF!?!? Too many rules, right?), then you shouldn’t be servicing your own non-performing notes.

This is like buying insurance for your investors’ money; you’re putting it at risk when you start doing borrower outreach on your own.

Joel hits on a few price points, something you should research on your own time as different servicers provide different services, but it does peak interest when you hear that additional features of their loss mitigation department charge in line with seeing you succeed as an investor.

We know how much everyone loves paying vendors, but I don’t have a problem paying when they’re making me money.

You’ll hear some numbers that Joel uses as a portfolio average for loss mitigation that you should be setting aside when evaluating notes. Everyone uses a different method and we would suggest a conservative approach to these numbers when you’re first getting into the game until you’ve developed a better understanding of all the moving parts that are incurring costs when working out a non performing note.

You’ll also be walked through the process of working with a servicer and how to best utilize that relationship when boarding new loans. Its important to set up this relationship before you close on your first note to make sure this is a smooth and expedited process. You’ll hear about the workflow process for working out the loan and the steps involved.

If you’re looking for assets, Joel talk about Porthos, his trading platform for lower valued assets ($125,000 UPB and below)…Hint hint people, for those of you asking where you can find notes to buy, this might be a place for you to go, but you’re going to need to bring your checkbook, or maybe your Uncle’s as they prefer pool trades in the $200,000+ range. Joel closes with his thoughts on what to do in your first 30 days in the note business.

“Co-opetition” Cooperative competition, Joel’s term for the non-adversarial approach most members of the note business have towards each other.

Joel’s parting advice is that you need to be willing to evolve your plan you develop more skill in the note business and as you see the industry change.

One of the biggest points Mark hits on is telling you to record your assignments when you buy a new note. As always send you questions to [email protected].

Listen to this week’s show and learn:

• What A Servicer Does
• Why Servicing Is Important
• Dodd Frank
• CFPB
• Give Yourself Options With Due Diligence
• Spend Your Time On Things Your Better At
• Assignment Recording
• "Co-opetition" in the note business

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Thanks for listening to our show! We’ll be back next Wednesday morning.

Cheers,

Chase & Robby