Launching into Note BuyingA Roadmap and Primer

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Overview: MortgagesOverview: Mortgages

• Wild market

• 50M Homeowners (assume 1 mtge/homeowner)

• $100K estimated avg mortgage size

• $5Trillion in mortgages• $5Trillion in mortgages

• Up to 10% non-performing (e.g. delinquent in some )way)

• $500B in non-performing mortgagesp g g g

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Overview: Mortgage DerivativesOverview: Mortgage Derivatives

• Much larger markets

• Mortgage-backed securities• Mortgage-backed securities

• CMO’s

• More $Trillions

• Credit Default Swaps (unknown volume – AIG)p ( )

• Add in Credit Card, Auto … ALL potential targets of a “government bailout”of a government bailout

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Conclusions on the MarketConclusions on the Market

• Volume of default will far outweigh bailout $ available

• Key driver to default is home value depreciation + employment

• Values still falling – Foreclosure volumes = leading indicator 105K prime FC’s (July 08), 92K subprime

• Unemployment (up from 4 7% to 6 1% – Aug 07-

FC’s (July 08) – 10% gain from June 08

Unemployment (up from 4.7% to 6.1% Aug 07Aug 08 - 30% increase!)

• CA only (up from 5 5% to 7 7% 40% increase!)44

• CA only (up from 5.5% to 7.7% - 40% increase!)

OpportunityOpportunity

• Banks holding loans (“portfolio’ing” banks: regionals, locals, FCU’s)

• “Non-targeted” institutions (To be determined)

I tit ti ith l t f f i t• Institutions with lots of non-performing assets

• Treasury – T A R P (Troubled Asset ResolutionTreasury T.A.R.P (Troubled Asset Resolution Program)

• Possibly lots MORE activity (price discovery• Possibly lots MORE activity (price discovery, capitalization need)

P ibl NEW (h d f d i t55

• Possibly NEW sources (hedge funds, private equity funds, other “TARP Servicers”)

Opportunity (cont )Opportunity (cont.)

• The “last mile” always wins• Baby Bells and POTS

The Last Mile in Non-Performing Notes

• You and your “local” area

O Y th W k t S i li t• Or You as the Workout Specialist

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How to Get Ready for the “Last Mile”How to Get Ready for the “Last Mile”

• It will take you no more than 8 weeks to get “launched”

• Know how to Find Notes

• Know what Price to Offer in order to make a profit

• Know How to Close on a DealKnow How to Close on a Deal

• Know What to Do Once You’ve Bought your first DealDeal

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The 8 Week Road To LaunchThe 8-Week Road To Launch

• Week 1: Learn to use at least 3 desktop-based propertyWeek 1: Learn to use at least 3 desktop based property valuation tools, and learn how to get the most out of realtors.

• Week 2: Find out which vendors you can use to help you research title work, and gain hands-on practice

• Week 3: Learn the principles of negotiating bank notes.

“underwriting” (performing due diligence on) a note.

Learn the steps in a bid process, how to maximize the value of your bid, and how to beat out others bidding on the same notethe same note.

• Week 4: Learn what it takes to actually “Close” on a note – review the “closing” process, including the

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principles of negotiating bank notes.

The 8 Week Road To LaunchThe 8-Week Road To Launch

• Week 5: Learn the 5 Exit Strategies drill down throughWeek 5: Learn the 5 Exit Strategies, drill down through examples of foreclosure from the point of view of the bank (get the foreclosure process down pat).

• Week 6: Learn the basics of servicing a Note and of taking a property back after a foreclosure (Real-Estate

• Week 7: Learn the 4 ways to find bank notes – and

Owned or REO).

start off by practicing using brokers, other investors, and the shotgun approach.

• Week 8: Review Finding Notes, and tackle Source#4 –Banks & Other Sellers. Sign up with an online note broker to review complete data tapes; break through to

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broker to review complete data tapes; break through to at least 1 bank that sells notes. Bid on at least 3 notes.

How to Get Going: Week 1How to Get Going: Week 1

• Week 1 – Valuation Review & Assignments

• 1200 Hope St Denton TX• 1200 Hope St, Denton, TX

• Realquest, Trulia, Zillow

• Plus – Realtors

• OBJECTIVE: Buying a Note and MAKING A PROFIT!

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How to Get Going: Week 2How to Get Going: Week 2

• Week 2 – Title Review

• Source Documents County Assessor (Taxes)• Source Documents, County Assessor (Taxes)

• OBJECTIVE: Buying a Note and MAKING A PROFIT!

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How to Get Going: Week 3How to Get Going: Week 3

• Week 3 – How To Bid

• Lender is in bankruptcy• Lender is in bankruptcy

• Final assets being “disposed of”• Lack of oversight / good asset management

• No active foreclosure, but loan is in default,

• Good opportunity – solid market – 55 – 65%

• OBJECTIVE: Buying a Note and MAKING A PROFIT!

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How to Get Going: Week 4How to Get Going: Week 4

• Week 4 – “Closing”, loan docs / purchase docs

S th D t T lkit• See the Document Toolkit

www.NoteBuyingProfits.com/toolkits.html

• OBJECTIVE: Buying a Note and MAKING A PROFIT!

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How to Get Going: Week 5How to Get Going: Week 5

• Week 5 – Exit Strategies & Foreclosure

B f “E ti ” i H E it• Beware of “Exceptions” … review Home Equity Foreclosure Texas

www.ExpertLaw.com• Talk to the Seller – death in family, probate,

dispute between wife and brother

• OBJECTIVE: Buying a Note and MAKING A PROFIT!

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How to Get Going: Week 6How to Get Going: Week 6

• Week 6 – Servicing your Note

T lk t S i PLM FCI N t S i i• Talk to a Servicer – PLM, FCI, Note Servicing Center, Trust Accounting Center, SPS, SLS – how do you service what does a contract look like?do you service, what does a contract look like?

• OBJECTIVE: Buying a Note and MAKING A PROFIT!

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How to Get Going: Week 7How to Get Going: Week 7

• Week 7 – Finding Notes

Di tDirect• LaneGuide.com

Y ll P• Yellow Pages• Network, network, networkI diIndirect• Brokers• Title, Trustees

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• OBJECTIVE: Buying a Note and MAKING A PROFIT!

How to Get Going: Week 8How to Get Going: Week 8

• Week 8 – Find, Bid, Buy

Y READY!• You are READY!

• If you don’t have $ - refer to another Note Buyer, y y ,use the PAC Forum – post a note for sale, contact us

• 1% Referral Fee, Trailing Revenues (6 months)

If o DO ha e $ then BUY• If you DO have $ - then BUY

• OBJECTIVE: Buying a Note and MAKING A PROFIT!

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• OBJECTIVE: Buying a Note and MAKING A PROFIT!

How to Get Going: Denton TX the Plan?How to Get Going: Denton TX – the Plan?

• Buy, Re-Write or Foreclose

$75 85K h• $75-85K purchase

• Reinstate – 18 months @ $1,088 plus monthly@ , p y

• OR – foreclose (possible upside in equity)

• OR – refinance with borrower who qualifies for new loan

• OBJECTIVE: Buying a Note and MAKING A PROFIT!

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• OBJECTIVE: Buying a Note and MAKING A PROFIT!

Call To Action Your Opportunity TONIGHTCall-To-Action - Your Opportunity TONIGHT

A-Z Profiting from Discounted Mortgages Business-in a Box’ 16 hours+ of Video Training plus LOTS ofin-a-Box – 16 hours+ of Video Training, plus LOTS of bonuses

N B i P fi / d h lwww.NoteBuyingProfits.com/preorder.html

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Call To Action Your Opportunity TONIGHTCall-To-Action - Your Opportunity TONIGHT

SPECIAL FOR TONIGHT ONLY:

• Promo Code ‘700’ (to be filled in at the TOP (RIGHT of the order page where you put in your CC info):

• 5% off of our package deal

G d th h 12 EST t i ht ONLY• Good through 12pm EST tonight ONLY

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Call To Action Your Opportunity TONIGHTCall-To-Action - Your Opportunity TONIGHT

Fast Action BONUS:

• First three sign-ups get 60 days PAC for free g p g y(rather than 30)

• NOTE: This includes the ‘8-Week Roadmap’ the• NOTE: This includes the 8-Week Roadmap , the 23 pages of check lists, the Resources Section, the DOCUMENT TOOLKIT, the basic ‘how to raise money’ toolkit, and more bonuses…

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Next WeekNext Week

How to Talk to a Banker

• Practice Conversations

• How to – Opportunity to Practice Yourself (3 lucky participants)participants)

• How to – I will give a few example conversations ( i t ’ d h d i t ’ )(easy intro’s and harder intro’s)

• With our Banker … Saprina

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