201 Legacy Notes: Cherry-Picking Performing & Nonperforming Notes

Foreign this is the no Closer show where you get the latest developments in distressed note investing and learn the secrets of how you can control millions of dollars worth of property. For panties on the dollar. Get educated and entertained by someone who has closed thousands of deals and lives to support you in achieving the same. Now here's your host CEO of We Close Nodes, Scott Carson. Good morning, good afternoon and good evening. Hey, welcome to this Money Monday, our WCN coaching call. Hope you are doing well. Things are rock and rolling here on a Monday. I am dragging a little bit of butt after teaching for the last three days. But we had a really great class, lots of great questions. Love seeing light bulbs going off, people getting ready to make offers, submitting offers on stuff and so just, just jacked up this Monday morning. Hope you all had a great weekend or great week and everything is rock and rolling when you listen or watch this video. But one of the things we had happen this weekend is Friday afternoon like always. We end up getting some tapes in. We got in A list of 201 notes from 1 of our hedge fund sources and yes, they can be cherry picked. And so I thought what we would do today is go through a little bit of this kind of if you're part of the WCN crew, the monthly membership for $97 a month, you should have access to this. We uploaded it this morning. Turnaround time on this is kind of quick actually. They actually wanted bids in by later today. So you know if you can get them in by tomorrow, if you're part of the WCN crew, great, good stuff. And get rock and rolling. If you like access, you can sign up for a WCN Crew membership@note umbrella.com that's note umbrella.com besides access to tapes and lists and stuff like that, you also get access to our online training classes and stuff like that. But anyway, breaking this down, it's basically 201. These are mostly first liens. There's a couple unsecured, a couple seconds in there. But mostly first liens. And it's almost split down the middle. 99 performing notes and then 102 non performing notes. And when they say legacy that means that these notes have been around for a while. Okay, that legacy, they've got some legacy. They got some payment history. All right. But you can kind of see the geographic map of these things. A lot of these, you got a couple up on the west coast there, which I'm probably not going to make any offers on. Some in Texas. But most obviously you see Michigan, Indiana, Ohio, Tennessee, Florida, North Carolina, South Carolina. So up in New York, New Jersey, I'm probably going to make an offer in just about every one of these except the New York, New Jersey ones. Yes, some of these are ugly, but a lot of these have some really good value. Now give you a bit of a breakdown. Like I said, legacy notes are notes that have history and based on what we could tell looking at this tape, some of these have been acquired by a fund, they've been modified forbearance. These were used to be at higher interest rates. Some of the borrowers modified, there's a couple at 0% interest which that means okay, they're fine. But the great thing about it, their values are outdated. The most recent values they have on chunk of these only like a 20 or so is that is 20, 23 values. There's a lot of these are older values which shows me that the seller's motivated to get these off their books. They bought these, they've owned these for a while. They bought them when they're non performing at one point and either worked it out with the homeowners for payment streams and they've been paying for a while, then others haven't been paying for a while and that's okay, at least the opportunity, even some of the performing stuff has been paying for a little bit. So there's basically five years of payment history. You have 60 cells of showing what the borrowers have paid and you can tell a lot by payment history. You know, borrower misses a payment or they made double payments and they've been paying on time. It's really a nice, nice tape. If you're looking to put some money to work lower balances on some of the stuff, you still got some, you know, 10, 15, 20 years. You got to be careful when you make offers on some of that stuff to make sure that your yield is good so that if you does sell off in seven years, 10 years, you've made your money back and then some. But there's quite a few modifications and like I said, based on what we looked at quickly on the by batch geo and mapping it and looking at some of the properties this past weekend and going through it with our, the class attendees, there's some pretty good deals in this thing. Right? Let's see who's on here. Live with me right now. So Albert, you were a part of this out of SoCal. You were. Oh I like that you put your, your phone number in SoCal. That's a smart marketing tool thing to do, get people to market to you. Okay. But this is a list that I think is got some definitely opportunity. You don't have to have a lot of money. There's a chunk of performing stuff that can be bought at double digit discounts. Dive into the tape here real fast so that you guys can see it and go in here. So here's, here's literally the tape. Now it's like I said, it's mostly firsts. You know, there's a couple unsecured, there's a couple seconds in here. Thanks Ver Vern always done a classic class. We caught up on and for hours on YouTube. That's awesome. Glad you joined us there, Vernon. That's why we share it there on YouTube. Obviously we'll take it down off of YouTube later today. What's there for w some member. Glad you enjoyed it. Glad it answered a lot of questions for you. But to give you, you know to break down on this stuff, there's, there's stuff all across the country and if you look at like they have current UPBs, so current UPB and deferred balances and legal balances. So they have UPBs, you know, for not very big. Like you know, 31300 bucks all the way up to 67. Yeah, they have one. It's 386, 000 is the UPB on it. Most, for the most part it's a lot of that fifty, sixty thousand dollar UPB stuff which is completely fine payments, you know, anywhere from you know, a couple hundred bucks, 150 bucks or so up to a couple thousand. So. But the great thing is when you look at this stuff, you can literally see, you know, not only is the address UPB when the appraisal date was done on it was originated data last activity when it's next due. That's a good thing to classify but it's a mixed bag of performing and non performing. The non performings in red, the performings in black. Okay. And looking over here, you know, you can see corporate advances, all that good stuff. They start with April 1st of this year and they go all the way back to keep going, keep going. It's actually more than probably five years. They go back to. Drumroll please. May 1st of 2000. April 1st of 2010. So. Oh wow. So it's 15 years. I was wrong. I mean you don't need 15 years. You really just need the last 24 months to figure stuff out. But some people have been paying for a while. So that's about when they took this thing over. Obviously bought it back in 2011 and started working through it, which is totally fine. Somebody buys a Portfolio back in 2011, they work through it, they get the bar back on track. Why they haven't foreclosed on a chunk of these, I don't know. Okay. But most of these have been performing for a while. So it's an easy way for you to step in some cash flow with motivated sellers. Okay. And cash flow with people that have a ton of emotional equity who want to stay in the property, keep making payments on the property and so stuff that is pretty easy. I don't know who the existing servicing company is on this deal. All right. But it's an opportunity for us to purchase some stuff, some performing stuff, some non performing stuff and really get rock and rolling. Now how would I rank this list besides getting rid of, you know, besides getting rid of the states? I don't want to buy in. Tom, I'm going to go over and just run a number down there for those that have paid the last 24 months. That's pretty easy. Just going, you know, last 24 payments, last 12 payments, what they should pay when they shouldn't have paid. And then those that haven't paid anything, look at the states where they're at, do a quick view kind of condition they're in. I'm probably cutting things this down to about 100 notes. I mean there's. When I was looking through the class, the list last night with everybody in the class, I had already identified like 60 non performing make offers on. So my offer is going to be that plus a chunk of performing stuff. Now we've got a couple students from the class already submitted like 6, 7, 8, 9 offers, which is great for them. Their first note purchases and they're making offers at a 16 to 20 yield awesomeness stuff. But this is ideal. And if you're part of the class and you don't have any private capital, this is a great opportunity for you to take this list, find a deal or two or three or four and market it. Hey, I'm working on a deal. I'm working on a deal here. I'm working on deal. They're trying to get your, you know, your network to respond back to what you're doing to fund some deals. Now my whole goal with this is when we take and make offers at, you know, 100 or so that we make offers on. Am I going to get all of them accepted? Probably not, but I'll probably get a good chunk, 40 to 50 of them and that'll be a Great way because then I'll have time to dive into due diligence, I'll have time to raise some capital and these will immediately, especially the performing stuff will immediately step in and get some cash flow. And I've got an investor lined up with some deeper couple investors lined with deeper pockets who are looking for a decent yield that this will be a great deal to get them involved in. And since it's going to be a chunk of money, we'll basically create an llc, structure the deal where they're, we're co owners of the llc, run everything through servicing company and I'll get paid out on a monthly quarterly basis off of split of cash flow, split of equity, stuff like that. And so I'm really, really excited about this deal as an opportunity. Is this going to be a retire and go from there? No, if you look at. Let's run some numbers here real fast. So this, let's, let's do this. Let's run. I'm going to get rid of the unsecured, the seconds. I don't want the three seconds on here ones in Rancho Cucamonga, California. Okay. All right, now some people. Oh, Rancho Cucamonga. Well, if you've got the spreadsheet, take a look at it. All right, I'm, I'm just going to leave the New York stuff in here for the time being because I buy that stuff, I get offered very little for that stuff. Since it's in New York, especially the non performing stuff, it'd be valuable to make an offering on that stuff cheap, cheap. And then offload it or forgive it or just try to work it out with the borrowers in some sort of payment plan or start the foreclosure process if it's worth it or forgive it and write it off our expenses and treat those assets at a loss to offset profits, you know what I mean? So if we look at the current UPB of this tape, these 201 assets, it's 8 million in Curry unpaid balance, old, old appraisals. These are old valuations. A lot of them are internal. This is 8.4 million. Well, I would say it's double. That's probably 16 million based on what we found. Okay, but it's going to even be better than that because of the, you know, appreciation. It's probably at 12 million. There's usually a chunk of value on here that they were not accounting for. Okay, so now if we go over here, all right, what I'm going to do is I'm going to insert a Date. I'm going to go over here to say, all right, they have the previous, previous P and I payment and then we're going to do current P and I payments. All right, so current P and I payments, where is it at here? Current PI payments. There we go. Okay, that's better. Okay, current P and I payments, we're just going to sum that up is 6 64,821. So it's equal to that times 12 months. So if they were all to pay, they would be bringing in in a year basis. Drum roll please. That's a dollar amount. 771. 777,000. So it's basically about a 9% yield just off of what they should be paying. Right, but we're going to do one other thing here. Let's go over here and we're going to go to where the starts here. So we're going to insert a column here so see how much they've actually brought in above and bond. So we're going to say this number. We're going to basically go back and take the last 12 months. Last 12 months, cash flow is equal to some. We're just going to go from April of this year to May of last year. Not 13 months, but 12 months. There we go. That one's brought in 6,000. Now we're going to copy that formula down all to 199, 198 since we got rid of the three seconds. And then we're going to auto sum that up. They should be paying. And so they brought in based on. That's not so bad, 70,000 in the last 12 months this tape has brought in. Oh, I don't mean it because it's a total already $72,000. And if you look at. So it's, it's, it's in done a pretty, pretty decent jobs based on what they should have brought in. They brought in about 90%, you know, of what they should have brought in. The rest are going to be foreclosures. Now some of these are zero, haven't made any payments in the last 12 months. Those are easy for. But this is a. If you look at some of the cash flow basis of this, some of these can be pretty good freaking returns. And most of them have the size of chunk of equity because values have not been pulled in the last three to five years. Okay, questions, what questions do you guys have? 100 out. You know, Alex, I mean, Albert, Vernon, what questions do you guys have? I know you watched a little bit over the weekend. Albert, you were there live for any watch or some of the biggest takeaways from this list. Yes. This list can't be cherry pick. If you want to make a couple offers, get a couple offers into me, we'll add them into our mass massive list that we send in later today. Like I'll give you an example. We Judy Richards is a was on the call this weekend. She's been an investor for quite a while, works full time. She liked the fact oh I can actually pick up six or seven make some offers and get something between a 15 and 20 yield on a passive basis. She's been more of an active investor doing some private money lending, making on some fix and flips. She's also bought some, invested in some apartment syndications that are not performing. Okay, so you missed this section of Sunday people. The video on YouTube is still up for you Vernon to go watch there. We'll get the replays out probably Tuesday or Wednesday. So I will leave that YouTube video up through tonight. Okay, I'll take it. I'll make it private tomorrow morning for you since your WC and crew member for you. But you know this, the whole thing about this throughout the weekend is look, we like to dispel the fact that hey, you know if we go. Okay, so let's actually, let's do something here. So if you look at the total UPB on this thing we can run some averages here. So 8 million, you divide that by 198. I mean the average UPB is 41,000. Okay. You know the app, their old values from three, four years ago, you know it's going to be a little bit higher than that, but it's actually a lot higher. Some of the assets we looked at had you know, $100,000 in increased value depending on it. And, and it's all across the country looked at you know, great states in Michigan, Ohio, Indiana, few in Texas, some of the Texas, there's a couple in Texas that were just kind of ugly. But that's okay, it is what it is. You know, that's where you look at the stuff and do a deeper dive into it. And how are we going to make your bids? We're going to look at their what they give as appraisal value. Make an offer off of that in the UPB in the payment history and then go from there. It won't take too long to get our bids in and then we'll wait and see if what they accept. If I can make 100 beds and get 50 accepted, we're rocking and rolling. It's a good day. Even if I only get 10 accepted, that's still a good day. Provided that they all, you know, work out and due diligence for the most part. All right, but this is a, this is what we see. We're seeing a lot of this kind of stuff coming in across our glass, across our desktops. We're seeing stuff on a regular basis. If you know how to market, you'll get tapes in. If you know how to market, you can raise capital. All right, there's too many people out there talking about, oh, there's not deals, there's deal flow. If you'll look at it, that's what it comes down. There was a guy on LinkedIn and XWC, remember all, you know, a couple years ago, he's in for only about nine, you know, 90 days or 120 days and he canceled. Well, I can't find any deals. I'm like, we're posting deals into the base camp group on a weekly basis. He was making like one low ball bid. New York, like, why are you wasting time on New York? And he wouldn't market for capital. And easy. All I advising people, not by two years ago. Like, listen, if you bought notes two years ago, you'd be buying at a bigger discount than you are right now. I mean there, there's plenty of opportunities, but you got to, we have to get outside of our comfort zone, people. If you're inside your comfort zone on a regular basis and you're not doing, you're not growing, okay, Would most people freak out about making 100 offer? Making one offer, I'm a little bit more of a verbal gambler. I'm not afraid to make 100 to 200 offers. Do I have the, you know, 3, 4 million now? But I know that I raise it. I know that I'll probably cut that down to a million through due diligence and condition reports and stuff like that and doing some online due diligence. See what it is. Once Odin taxes and once I have the borrowers a making sure that hasn't gone to tax sale, stuff like that. Because some of the stuff hasn't been touched for a couple years. So it's an opportunity, guys. Great way to kind of get your feet wet. Get a couple bids in. Use some of these assets to market to your database, market to your LinkedIn, to your social media, to your email database. That's what we want. The only way you're going to get better is to start changing what you're doing. If you're just showing up and being a wallflower at your local real estate club, you're only commenting or spewing to hate on social media, then the problem isn't other people. The problem is you. The problem is you that you're not taking offer, you're not making offers and all of you are capable of making offers. Okay, if you need some help hand holding, walking through, what should I bid an offer on? You know, go through the list, identify a dozen or so and let's work through those things that we get. Rock and roll. Because this is an opportunity, especially with us making a big chunk of list. If you come back and say hey, I'd like to make an offer on one of these and we've made an offer, that's fine, I'll gladly once the bids get accepted back, glad to push a deal or two your way and make it worth both our times. Right everybody? So hopefully you had a great weekend. Our next three day virtual workshop, it's going to be probably with it being April, May right now, it'll probably be August or early September. So that's probably what we'll shoot for. Not around Labor Day weekend, but probably give or take a little bit right around the start of month or two in the school year and stuff like that. We'll probably do it online and then we'll probably do an in person workshop, November, December here in Austin as well. So any questions, comments, concerns before I let you guys go? I've got a busy day, a little bit of work to do and then a whole lot of rest once I get these bids in. But hopefully you had a great week. Thank you. Those attended. If you're watching this online, make sure to thumbs up. Subscribe if you have any questions, comments, feel free through Feel free to book a phone call with me@talkwithscottcarson.com that's talkwithscottcarson.com yes, when you book that call, it'll be with me and we're glad to talk and help you take your business, your real estate, your note, your life to that next level. So go out, take some action buddy and we'll see you at the top. Bye everybody. Hey real estate investors. If you have ever wanted to dive into the sexy side of real estate and become a note investor and not just somebody that owner finances properties or buys and sells on terms, but somebody who's actually buying debt from lenders, mortgage bankers, hedge funds on distressed real estate on both residential and commercial properties, now is the perfect time and Guess what? We have our upcoming three day workshop here in just a few days on July 25th, 26th and 27th. That's right, that's a Friday. Saturday, Sunday. You can join me live on Zoom and our Note Buying for Dummies workshop. We'll go through the apps of how to find fun and flip non performing notes at huge discounts without having to use your own money. And we'll show you all the different ways that you can make money being a note investor. Day one is all about how we find these deals from banks, hedge funds and how you can automate the process of connecting with these people and get tapes and listen to you over and over again. Day two is all about raising capital and marketing and we'll show you how to tap into thousands of IRA investors who are looking for deals to fund and how to communicate and how to contact them and get them to fund your deals. And day three is all about the Flip the exit strategies. Putting deals together will mix in due diligence. We'll mix in the marketing side along with the structure side. So much stuff in three days Live on Zoom with yours truly, the Note guy, Scott Carson. Make sure you get signed up by going to Note buying for dummies.com or click on the three day workshop tab on our Workshop. Get signed up today as we're still running discounts and you too can soon become a no buyer.