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As you get started in the note business, how often do you overcomplicate it? It’s not all roses in this field, and sometimes how you market the business can turn into conflicts if you are not wary. Today, Chris and Gail share their ongoing deals to date. As they highlight Gail’s experience in putting up a Facebook ad for her house, learn more about insurance and all the sweet surprises we get. Moreover, discover the maximum number of calls to make to borrowers before you send out the notice and the tragedy about door knockers. On top of that, find out what happens if a borrower destroys the house and what to do to stop tax hemorrhage.
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There are many FAQs from note investors as they venture into real estate investments. The most prominent ones concern insurance companies. Beth Boisseau-Coots, CIC, the Vice President of J.B. Lloyd & Associates, LLC, joins Chris and Gail to go in-depth on the worries every real estate investor and note investor have when it comes to loans and funding. J.B. Lloyd & Associates traditionally specialized in insurance for financial institutions, but has now extended their services to real estate investors as well. As they dive into queries starting off with the coverage of insurance, get educated on the difference between a real estate investor policy and a lender-placed or force-placed policy, liability exposure, the two different types of policy for real estate investors, the best kind of insurance for landlords with rentals, claims made policy, occurrence policy, and more.
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When someone borrows money from you for business purposes, expecting it to be paid is normal. However, in some circumstances, the borrower may have some issues paying it back on time, and this is when legal measures come in. Chris and Gail talk about when to go to legal and getting the process rolling when a borrower fails to make payments. They share experiences of having to hunt down borrowers to get them to pay. The legal process requires an attorney and choosing the right one is always necessary. Chris speaks on what you as the lender can do in terms of proposing settlements and accepting payments even with an ongoing legal process.
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Celebrating a milestone, Chris and Gail are now in their 50th episode where they discuss legal matters as well as breaking up with realtors. The real estate world entails a lot of legal aspects in the business, and it helps to know how to take these situations head-on in order to work well with borrowers. Together, Chris and Gail outline the steps in dealing with various legal situations, most especially those who have a note and needed to take some legal actions against unresponsive borrowers and/or renters. They go in-depth about letters, door knockers, Cash for Keys, and more.
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Many people can be successful in doing note investing, but you have to remember that this isn’t a race. The reason anyone is more advanced than someone else is that they have done the deals and paid their dues. You need to build and have the confidence to make that next step and take a leap because buying a note is pretty simple compared to everything else. You can’t become good unless you plunge in a big way. Learn how you can do note investing successfully as Chris and Gail answer questions and comments from other people on this open mic night.
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When you are making a note investment, it is best to have a thorough home inspection on the tape. Chris and Gail continue the conversation and focus on some home inspection red flags to be wary about a tape that you acquired. As we touch on the advantages of hiring a third-party and independent home inspector, learn why it is crucial to oversee a portfolio of real estate and manage construction projects sometimes. On the side, find out what escrow and tax and insurance balance is, the bankruptcy basics, and the difference between a note and a mortgage.
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It’s very easy to look at a big tape and see big ROI numbers and think, “This one is great. We should do this.” However, when you look at a big tape or any tape for that matter, you should always evaluate from the standpoint of things like how beneficial is it to buy a particular asset? How many payments are there? What makes it a great deal for a JV? Chris and Gail get into buying and reselling tapes at a profit. As Gail goes into a new CFD tape with over 650 assets on it and how to approach a big tape like it, Chris tackles how you should structure your JV agreements and touches on the process of doing his very first rehab in over 100 notes that he’s done and gives some recommendations for people who are doing some work on properties.
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There are sweeping changes in the note business nowadays that investors should be aware of. Today, Chris and Gail break down some of the shifts they witness in the real estate note business. They go in-depth with the deadlines and demanding paperwork from FCI, the consensus favorite for IRAs with Quest Trust Company, and checkbook IRAs. Find out how long it takes to have reports such as a two-owner in your doorstep and the two loan servicers that provide exemplary expertise.
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One of the ways to make a profit in real estate is to do rehabs. A real estate rehab is done when an investor acquires a property then sells it to make a profit. Chris and Gail talk about their experiences doing rehabs and let us in on what we can learn during the process – doing cross-country, dealing with contractors in renovation, and dealing with potential buyers. They also state some of the important things to note when you start getting more notes in your portfolio in dealing with rehabs, such as making sure you budget correctly and have reserves. Get ready to learn more about doing rehabs as Chris and Gail dive into the subject.
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Selling notes and assets can be a tedious task. There are steps that need to be done when selling a note, REO, or CFD. This includes shutting down the insurance as soon as possible. It is also necessary to have utilities changed into the new owner’s name and that instructions are clearly delivered to from the sellers. Chris and Gail discuss the paperwork one has to deal with when selling notes and assets with all the different forms that vary between states. They also tackle how dealing with bank underwriters is a part of the steps in selling, and why any sale that does not push through can be considered an opportunity rather than a disaster.
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