How to Read Distressed Note O&E Reports and Spot Assignment Chain Issues | Real Estate Notes Show

three or something like that and then the banks don't want to talk to you again because they say you need to renew the power of attorney it's limited but I was just asking with this title whether it mattered or not no I don't think so what what typically Happ Happ s um what typically happens is the bank uh allows a individual to sign for a given trust they don't just give you a limited power of attorney to sign anything you want for the bank no any documents related to that trust that's the limitation right all right so let's not get stuck on on on this uh on this mortgage but certainly uh I just showed you that this report lacks some of the I'd say Clarity and analytics in the assignment chain it's not clear to me where's the break when you're the investor and you have a thousand loans to look at you don't want to find this language and then start peeling the onion trying to find out if that sense I want something that jumps out and says assignment chain is broken done Al just for just for clarification we get something like this and we need clarification uh we shouldn't be calling you you should be talking to an attorney because you technically wouldn't be you won't want to decipher what you find you want an attorney decipher correct uh yes or no we help the investors so Jim probably knows that you know anybody that is new to this business uh can call in and and we have people on the phone that that are helping uh new investors to read the first report and then once you look the at the first one I think it becomes easy to analyze the second the third once you know what you're looking at so um to me this report is is a little bit hard to read um it's not mine document if it's signed as attorney in fact okay oh you really want to ask your title vendor to provide this document so you can verify that the person signing which is Jim is a an actual appointed senior vice president to sign on behalf of US Bank as a successive trustee verify well like when you like this you call Bank of America or yeah you're not gonna call Bank of America and find out who owns it what he's saying is the document will prove that they are who they are and they have the ability to find that if you need to have that yeah so why is it important first of all if you're planning to foreclose on a note you better have a good standing so you better have a clean assignment chain and you better have a clean standing so you can prove to the judge to say hey judge I got it from party a to party B party B to party C and every signer on the assignment and endorsement was the rightful signor and I can prove it are there like like uh statutes of limitations or um time frames for somebody to have power of attorney right they expire they they typically yeah so so I I haven't heard that the power of attorney expires by statute of limitation now um I think for the most part all the mortgage assignments now should have a reference to power of attorney if it's signed as an attorney inact okay because like 10 years ago when I used to do a lot of short sales yeah somebody that want to sell their property I would make them sign a limited power of attorney to me to let me handle all debts and actually the you know the transfer their property power attorney and then typically you know you get into year two uh let's see let me try to share my screen and then uh hopefully you'll take notes between Burgers let's see so can I share my whole screen or whiteboard Des desktop yeah I can do desktop there you go you can email the can you guys see my desktop yeah yeah all right so let's let's talk some uh some title searches here I'm not going to bore you with uh who I am and what we do I hope you guys know um we are local we're probably about an hour away from you guys you're in Jackson right yeah yeah how's the water down there did they figure out what was polluting the water no polluting the water at all okay all right think South were you in your South Philadelphia uh Southampton P right outside Northeast Northeast all right so let's uh let's take a look at some title searches I'll jump right into analysis and uh let's start with some searches that you guys ordered from us is Donna on a call too I don't know if she's on the call no but she had something that came up you had to go take care of tonight all right sounds good yeah I was the other half all right let's take a look at uh some of our competitor searches she wanted me to bring up search St and red Vision uh can you guys read the title search if you can open up I can I don't see it no I mean uh can you uh read what it says from the uh legal perspective or from your no F perspective yes all right well let me start with the red Vision title report so when you look at the red red Vision title report I'll give you a hint on where the report is done if the logo is fuzzy it's done in India in India if the logo of red vision is sharp it's done in US wow all right so if this I assume is done in India then I would assume that they don't know much about the title we know how to read the documents but uh let's start poking holes in it you guys know this file David it's uh um address is uh 4 2 North I mean Avenue West nework we're not super familiar with nework but we know the area it's good and bad nework all right so what do we know about New Jersey we know that New Jersey has records in the county office and S all the bankruptcy cases and judgments are located in Trenton we know that the townships hold the tax records and one would need to find out about utilities as well so let's see what our friends at Red Vision give you uh the report was ran 59 2016 let's see um it's it's it's a little hard to read it looks like Tucker owns the property they got it in 2006 through the uh interf family deed uh they got it from Angel and uh let's see Angel got it from Angel as well so they took the chain back to 2003 there's a typo here which is okay so I'm okay with the chain of title which is only the Deeds right you guys see it yep first deed second deed third fourth all right yes now look at look look at this little note comments tax information is not available well I disagree with that okay why if you know New Jersey City of New York is on online 1939 blood 60 so I already looked at it go there I think now I can go there oh there you go so city of New York I search by block and lot here's my owners okay I do want a fly title report that's the tax information so whoever did the uh the title report does not know New Jersey all right yes be careful next all right it looks like they have a mortgage information so mortgage e is mortgage chonic registration systems tax information was not available okay but he went online show the taxes out available got got all right now uh let's see let me just jump back to the uh Tex information I'll tell you what I'm looking at so first off if you would buy the note with a uh language text information is not available and you find out that the text is a delinquent I don't know who you're going to sue right so you have no legal protection on that title search what you have to to look for is thankfully the homeowner is paying the uh the taxes if the homeowner would not pay taxes you would have a uh Municipal tax certificate sold at the County office and the investor of the municipal tax C would pay off the the consecutive years of taxes us as the node buyer would have to pay off not just the tax C itself but also all the tax years plus interest plus penalty all right so I hope that makes sense right is that core logic that you're seeing that would that be a tax lean so core logic is typically hired by A lender to pay off taxes okay now cor logic is is a good thing homeowner is a good thing if you see something odd like an investor it will probably say taxes sold instead of tax payment oh okay so when you buy a note always demand a tax print out or tax report because that's number one thing that will kill the no's taxes right so um let's go back here hold on hold on Al should I should I wait until the end to ask a question oh you want to ask questions during it or you want to wait go ahead that's questions go ahead well I guess the question was I think you had said that it looked like this was done in India because of the blurry uh whatever so but if it was somebody that new nework would they have been listing this information for us they well we do it all right so you did but you did no this is not his company oh I'm sorry I'm sorry we just Goa you can pick them apart I got listen we we're the good guys you know right right right that's Pro Tile and this is red Vision that's a all right I got it I got it we're good all right by the way red Vision was just sold to First American that right yes so we can't tell by the VIS the blurry names anymore if it's India I think they still operate uh under red Vision so you know I don't know what what's going to happen now uh let's let's continue so mortgage information so let's look there they're saying that our borrowers are um are on the mortgage with MS $320,000 this is the dates recording date um let's see assigned I'd love to see the word assign to or final sign is NS 161 LLC is that you guys not actually yet no we just we're just buying it now we haven't even recorded yet okay all right so when I look at this verbage here really all over the place to me it's it's not in order it's not any sequence uh what they're saying in comments the assignment of mortgage for MS to US Bank National Association as a successor trustee blah blah blah blah blah um assigned in this book and page in 2010 then they say there's an assignment of mortgage from Ms um to what na star in 2013 so by looking at how they describe the assignments I I already have a few questions first of all if the earliest assignment was in 2010 from Ms to US Bank MERS has no more no no no power to assign the the mortgage on on the next assignment that would be considered a break in the assignment chain yes you have MS to years B and then mer to Nation Star yeah they can't sign twice right exactly so now if I look at the last assignment which I didn't yet and I find that the ns1 161 LLC got it from Nation Star I would question if that would be a valid assignment so they have to fix the assignment chain either by um filing the recision of assignment of mortgage for one of the assignments uh to correct the chain so on the Fly and I didn't look at it yet so let's take a look at the assignment of mortgage recorded in 2016 to your seller so bear with me I'll I'll try to go fast and hopefully I'll spot the assignment so is it possible that mer signed it twice only because they got it back no all all right so so here here is our assignment assignment of mortgage that's US Bank and you should have seen assigns to NS 161 LLC so it's it's good it's good hold on one second Alex so the question was this is a red Vision title report this is technically what newer investors what they call an O and Report which is basically a tile report but a mini version I'm gonna get into I'm G have Alice get into little few minutes when we're all getting calleded up what is difference between title and o report it's similar information it is a little different this is what they call an o report it's very similar information to title has so this is the o report that we order no space we buy that's not quite as yeah you ordered through this guy yeah Al we ordered through Al USA y but not this one no this one was ordered this this is Donna's fa no no no Donna this came with the note this is from the seller okay so we didn't order the okay all right you guys ready we ready all right so here's what I'm looking at the last assignment is from US Bank to ns16 did you guys see my pointer yeah yeah okay perfect all right so ns1 161 LLC so what I would like to see from the seller is to force a person that filed this assignment from uh let's see from from no no no wait wait wait what what's wrong with this picture Bank of America assigned to Nation Star Bank of America was not even in the picture what is going on here yeah we're yeah how did B mer get it bingo so this assignment is called the wild assignment uh and uh I would argue that the seller needs to clean up the assignment Chain by canceling this assignment of of of record so if I would look at this assignment I would say well first of all let me take a look at the book book and page so it's h uh 1213 9972 oh 12 13 99 yeah so this is for this mortgage so either they're missing as an assignment or first of all they abstracted this assignment in completely incorrectly right it's not from Mars it's from Bank of America correct so that's garbage right here me the S CH maybe not be broken it's the comments would be wrong yeah the what I can tell you that the attorney that that we had reviewed this file said that that's an erroneous um assignment that one you have highlighted now basically I guess it's it's just misprinted I guess maybe it was misprinted because it goes from the Bank of America yeah so so if you if you look at it if you look at it the assignment from Ms goes to Bank of America as trustee cor so it's not Bank of America itself it's not the entity it's the bank America as a trustee for the trust now um m mlmi is trust the one actually owns it yeah the trust itself is the right entity that owns the mortgage so Bank of America first of all um I need to check was it uh who assigned bank I thought right again well who was theor on the is that it no um oh okay so it's uh that's Lal bank but but Bank of America merging from Lal Bank to mlmi trck so it's it's there's some fixing that that has to be done yeah Bank of America sign that's incorrect so they cannot assign because they don't own it uh donation star na star I don't think they assign the next one yeah so that's okay US Bank as a successor trustee to Bank of America now the cleanest way to look at it is there should be a substitution of truste document file for this mortgage putting US Bank as a successor trustee that would be a clean way to do it now none of those documents existed uh one more thing I wanted you guys to pay attention so you see this power of attorney recorded on this and this when you deal with notes always ask for this and my my eyesight is not trained to look at the right place but but certainly with the information being wrong it doesn't help so let's uh let's go through it uh just completely and uh we'll see what else I'll tell you uh missing from that report so second mortgage so I'd like to see that it's a second mortgage it doesn't say anywhere that it's a second mortgage but let's assume it is Ms uh for $80,000 fine then they say name searched empty um judgments no judgments and they say name searched against this this this this and nothing of record what if I tell you that they're wrong now if you if you would be a foreclosing attorney and you would use this title search to foreclose on the property you would suffer a huge loss for not notifying all of the Judgment holders specifically the Judgment holders that are uh for the judgments that filed in the in in Superior Court judgments I'll just take the first name and and uh I'll show you uh this is a little snippet of of how you search for uh Superior Court judgments may have problems with the Jersey County court system after 5 o'clock FYI we'll save the work time on the website yeah they don't want hackers I don't know rushing bombing into it let's let let's let's now let's try again hold on let's let me let me do one of those things oh there you go okay so hopefully now it'll work if you're a New Jersey and you're not pulling these things you're in trouble all right it worked I'm in so talker and the name is this so on the Fly title report just to prove the point here we go all right look at that I active judgments which were not reported credit card judgment for 3755 86 all right so if they're not serviced guess what these guys can come out undo foreclosure or claim from the proceeds of the Foreclosure sale say hey guys we didn't get notified you have two options pay us in full or refile the Foreclosure well I mean you would hope the attorney is not using the O and E for you hope that he's not using the they should be pulling their own title this stff hopefully you're paying good money yeah we're hoping that I the right stuff you know okay listen I wanted to make a point that when they say this in New Jersey I just I I I I each to double check you know the first name I try it's come on guys you know any so um there you go now um other than that you have copy and uh I'm not going to go through all the copies on this report all right so now what's upsetting what's upsetting is um they use some sort of a Searcher on the ground okay it looks like he hand write something and he pulled the copies and they compil the report and they send it to you without much analysis so anyway uh that was a little upsetting to me now let's take a look at the other one uh there you go search Tech so I'm very good friends with the vice president of title operations at search Tech so let's see how they do so they're right in PH and um I thought their business slow there no only um okay you guys know this property somebody buy already yeah Jim's buying one Jim doesn't know we own this one wife spent the money we're not we're not no the other one we haven't bought yet but we have it in escro but all right okay so let's let's take a look at this one now um what can I tell you I can tell you that you don't need full title you you doing was the was the other report full title to it's an overkill for for a purchase of a note it's enough to have a when a report of current owner search full title goes back two owners in time for us or 30 years for title insurance uh you are probably overpaying 50 bucks or so per report so let's take a look now first page I don't see anything interesting second page nothing interesting and then this title report is made in the form of a title commitment um so let's take take a look first page so they are talking about some something not very interesting so uh they're saying that uh the property is purchased in 1998 uh let's see what else is here assessment which is not very interesting all right so not much here uh and then next page is uh let's see the way I read it mortgages you have two mortgages right good uh in the right position supposedly I'd love to see that this is position number one determined by a page and not necessarily the recording date which is the same for both first and second and then something that caught my eye this does not make sense at all okay so uh if they're saying that 34.5km is assigned to Ms uh that makes me think because this mortgage is with MS so something doesn't make sense sense here um all right none none none okay and then they have something here due for current tax year 2015 my very first question all right what about the prior years I want to see a clear indication that there's no prior taxes especially in PA all right and then they're saying receipts for 12 to 14 need to be produced and filed which means they never searched for it uh and they're talking about water sewer rents uh trash removal recycling all right fine so it it looks oh am I going to pay hold on what David I just got to know that uh I'll have to pay 15 bucks all right listen I got to go fast then I I'll I'll be very very fast all right so I SP $15 for you it's worth it okay uh should I res Skype you maybe uh we can redo what happens is after this time period you can actually stop it and restart it again you get those 40 minutes free all right let's let's do that then okay so uh exceptions that's typically entitle commitment what do you need to worry about and what things they didn't search so for every note that you buy things that are not a part of the o report are code violations in the township okay so code CD violations in the township the demolition check water and sewer balance and payoff tax sale date information if the tax is at the linqu okay that's very very important to know why because if the uh report says there's $110,000 worth of delinquent taxes and you the node buyer say all right I'll pay off $10,000 and the note is fre clear before you say that you have to check if the property scheduled for tax all right so by the time you purchase you lose a not sense all right so what they're saying is was they violations in titles reports if it was recorded it was exactly so we offer a an additional service to check for the township violation so we are checking for code violation enforcement Lans Township Lans uh demolition check and tax sale for 35 bucks extra code or Court the question was I'm sorry asking question is are you talking court or code violations code code Cod code all right here's a famous example and our friend if you know him uh Jack kupy from PRP um stumbled on on one of the cases which which hurt um in New York City New York metro area there's something called a New York code by enforcement division department of building and they have something called environmental control board leans ECB leans which cross attach to all properties and name owns in uh for any property the name would own in New York okay so what happened was was um the ECB lean was converted into tax lean and automatically attached to the property so you really have to be careful about the the township leans or Cod enforcement leans be converted as a tax lean we talk to you about a deal in Texas that were we're talking about that property Texas in San Antonio where two tax planes turned to Second mortgages that appeared on the on the on the o as mortgages but they weren't they were tax sales are there any other states that that happen uh that's very specific to Texas okay Texas Texas uh tax sale leans become mortgages so it doesn't matter if they're reported after the subject mortgage they would supersede by position okay so they're Superior is any other states or uh they have something similar or no that is the only one just like New Jersey I I told you about the uh Municipal tax sale certificates that can be for water sore common charges utilities and real real estate taxes so the only worry that you would need to have is a municipal certificate for real estate taxes everything else is treated as a lean which you need to pay off uh but uh the municipal tax sale certificate for taxes uh in New Jersey can foreclosing you yeah so that's very unique for new in taxes um you also need to worry about the school taxes they can be separate that's that's very very important gacha in in taxes also the tax Lans are sold as mortgages so they're reported and assigned as a mortgage is that school tax or any taxes in Flor Texas uh typically any o report will give you the county level taxes okay how do you tell in an o report that it wasn't tax lean prior is there any kind of indication on o that will say it was a tax lean beforehand yeah you should have a clear indication of of delinquent taxes so in other words if the tax Lan is issued either you're going to have a tax lean recorded in the Judgment section or taxes let's revisit real quick where does it say on the o and actually that um if if that was actually a tax lean converted to a mortgage has higher priority yeah that's uh it doesn't say it there's no theory in L reports so how do you make the association well uh let's see in Texas itself it's um local attorney would know or you have to know or you call us and we'll tell you that so there's no um easy easy manual to say in Texas the um mortgage for taxes uh becomes a higher priority okay that's a common knowledge in Taxas but if you are not familiar with that um aspect of buying notes and taxes that'll hurt you what is there is there any kind of system we can use to take advantage of where people avoid a note because of a o report that look negative that we can take advantage of and buy it for Discount because it's something we can easily correct that others are scared of um sure I mean sure so let me let me flesh something in front of you I'll uh I will not continue analyzing this but basically I found that the assignment was wrong uh the second assignment from this report so I'll let Donna give you a call and talk more detail about it I I want to try sticking more general questions if we could so so let me let me let me give you a quick overview I'm sorry get a Pro Tile title now so we can see what you do jumping I'm jumping to the Future so yeah so we for the volume buyers okay that buy in thousands they buying hundreds umy like Jack like Jack yes we give him something called the dashboard so dashboard is really a our analysis a title exam to give them everything anything wrong that can hurt him okay so as a part of this exam and we do it for free okay yes for free for for our our clients yeah that that buy in in volume so uh not only we analyze the issues and this is some of the samples right uh issues investing and I can talk about that uh as well so subject mortgage foreclose TR transfer to third party uh HOA lean foreclosure not in NADA uh and how to recover it so for example a lot of people think that once HOA forecloses in super lean States they lose a mortgage that's not accurate only Nevada and Massachusetts everything else can be cured so if you have a a Florida uh HOA foreclosure uh it's it's really a unresolved investing issue and you can recover the first lean position Okay so that's one of the examples that you can leverage by somebody thinking they lost the note uh and they didn't or uh with the TX Deeds right so I'm not sure if you know Rob from usmr y love rub love rub um so he was he uh he got educated from me um to scrub his portfolio to see whether or not there's some tax deeds with tax redeemable States tax deed redeemable States Louisiana has three years to redeem the tax deed so one would think Rob was thinking that he lost a note while he had a year to redeem so he can redeem it and get back to not not be back in position yeah I'll I'll call in in 30 seconds I guess uh my time's up here so I can reset the invite and we can do another 15 minutes so yeah um sounds good go ahead and do it D go ahead and do it charge for something like that without you know without the uh volume if I was just buying like you know three two or three notes what would something like this run okay hold on resend the invite because my my time is up and I'll I'll answer that question let me let me re the invite so that redeem the uh back taxes and any reasonable all right I'm gon try move over uh yes please beer okay [Music] right all right show on you I don't know if you can hear us can you hear us Alex yeah yeah I can this is a 40 minute thing if we need to I can always redo the call when we get done if we need more time are you guys ready is everybody ready go ahead man yeah all right so tell me first a little bit about what you guys buy first position notes we have second tier first tiers and uh couple guys that want to get into it all right okay so what's the uh let's see Donna sent me a few reports that uh we want to analyze are those reports for the first seconds or both first I think right now first right now all right how experience are you guys G expert hi well you'll see Jim's here as well hi Alex Jim per Jim how you doing pretty good hey Jim is Mark there too no D's not here Mark should be uh skiping in later okay on round two yeah all right sounds good a few people on the call that's listening in on the phone all right so let's uh let's get started.