Breaking Down a Note Deal Full Video | Real Estate Notes Show

Episode: Note Investing - Breaking down a Note Deal Full Video Dave's Goals and Plans: - Avoids properties valued below $50,000 or above $300,000 due to foreclosure cost efficiency - Does not buy in Kentucky due to $4,000+ annual debt license requirement - Avoids Northeast states (NY, NJ, PA) except recently reconsidering New York with caveats - Uses interest rate analysis as primary evaluation metric - tracks how rate affects yield calculations - Will not share deal sources or borrower details to protect competitive advantage Nathan's Goals and Plans: - Filters out states with difficult foreclosure laws (New England area, Maine, Rhode Island, Connecticut, Massachusetts, Hawaii) - Does not buy in Georgia despite favorable foreclosure laws due to licensing requirements and five-asset rule complications - Prioritizes interest rate analysis - higher rates on recently non-performing loans indicate better payment recovery chances - Looks for equity gaps (large differences between UPB and property value) to identify deals with more workout options - Verifies tape data accuracy - checks that 'performing' status and valuation dates are current, not outdated Key Recommendations: - Always verify property values independently - do not rely on tape valuations; use BPOs or market analysis - Check tape dates to ensure data is current (not 3+ months old) before making performance assumptions - Focus on first lien or performing second liens only; avoid non-performing seconds unless exceptional circumstances - Understand interest rates impact achievable yields - lower rate notes require steeper discounts to hit target returns - Evaluate state licensing requirements and foreclosure timeline laws before committing to acquisitions Topics Discussed: - State-by-state foreclosure law analysis and licensing requirements - Property value filtering parameters ($50K-$300K sweet spot) - Data verification practices for tape accuracy and tape age issues - Lien position strategy (first vs.

second liens) - Interest rate impact on yield calculations and deal pricing - Deal sourcing confidentiality in note investing hey everyone dave putz from jkp holdings nathan and i on this week's show broke down some note assets that we find very attractive or interesting we show you some issues some problems with some acids on tape we also show you some deals we liked we show you deals that we differ on some kind of opinion on what he may like what i may like may differ some things we agree on so this video was really good to do to show people what we thought you guys would learn from and maybe we can learn from it too hope you like it dave from jkp holdings nathan turner how are you man very very good you're a whole lot better now yeah we'll go from there so we wanted to kind of break down some deals we didn't get as many as i hoped uh from investors called zero so we're gonna break down our own deals um i have to record it go on youtube and everything else um and we wanted to show you guys how we see deals how we look at things which probably a little differently how you do it so um i'm going to see if i can get the crowd in here we have about 25 people uh live at that point um and see if we can come back in here and whatnot hopefully uh the sound should be perfect your direct linkedin and go from there so nathan when you get a tape how do you narrow that down do you go by states how do you narrow down your list so the very very first thing i do is i look at states so um there are when when in fact when i go out and buy notes if i'm going approaching a new seller they'll say what are you looking for and i'll i usually i just say i buy nationwide which is mostly true but there are some states that i don't like i don't like new york and new jersey i'm not a big fan of maine rhode island connecticut massachusetts kind of that whole new england area is really not good northeast is not a fun area it's not a lot of fun and the reason is because i'm always looking at worst case scenario which is a foreclosure and if it needs to go to a foreclosure those are some very difficult states to get foreclosures done and so and and you know what i learned by experience as well hawaii hawaii sounds all glamorous and cool man you get caught in a foreclosure and it just drags on forever yeah ask me how i know so we go by state right we filter states we don't like um and then what we do from there is we kind of say why do we not like to states is it the state illegal is it state because of uh debt licenses is it safe because of cost expenses those kind of things where is it that it's an issue um yeah yeah foreclosure is very very first thing foreclosure laws and time um but you're right things like licensing so for example georgia i i actually don't buy in georgia i love the laws that they have there as as in terms of foreclosure but i don't have a license there and i don't anticipate getting one and so it's just because it's difficult and it's an extra layer for those who don't know georgia has a law of five assets and you usually think your individual name and if you're a company um and if they catch you right it becomes a situation where you can be it's a family so it's a big deal um something we i veer away from myself yeah me too i steer clear yeah um so let's dive into what we look at very similar numbers right uh one of the first things we look at is states for us uh kentucky uh four thousand dollar plus a year debt license i'm not bothering no uh northeast i will look into new jersey i'm now avoiding pa new york up um pretty much um some plus new york entertained north west uh areas not the boroughs um and you know what i after our our interview a couple months back i am actually now looking at new york um but with a couple of of caveats like for number one there can't be a foreclosure already started yes there's a foreclosure already started i'm out um but but it's it's on my radar now at least and you know what only because we did this interview with uh yeah great taught us some things yeah yeah so if you haven't seen it definitely youtube check it out yeah so new york is back at least on the radar yes at least on the radar yeah so there's some quick foreclosure as long as you're not in that state you can do things video the process so for us the next pillar for me is i don't want any asset with a property value below 50 000 or above 300.

reasons is if i'm going to do any kind of kitchen work or foreclosure work and if it cost me five or six seven thousand dollars the value of the property means nothing in terms of foreclosure it's it's flat across the board and you could probably do the quick math five thousand dollars on a fifty thousand dollar assets ten percent if i'm losing it like that so lower price assets is something we um aren't attracted to the reason we don't do above 300 000 is the the person um typically is more experienced they have more money they have more abilities check out things um so we we kind of avoid that that issue of dealing with some facilitated buyers uh borrowers right so um and you can get you can check out the new york laws which isn't strictly for new york but our youtube channel which this will also be on um so there are some pillars that are coming about but you also have the debt license side of it which you have to make sure you you're aware of um you can watch our huge debt license video as well on youtube which is really intriguing and it's not a clear-cut answer right um but we would like to narrow down the list of what we see we are comfortable with i'm about 14 or so a little bit more than that but we primarily look for those kind of things the next pillar we look at for me um is either first or second or cfd right if it's a second lien um unless it's performing i'm gonna i'm gonna pull it out and just because the tape says performing doesn't mean it's performing right except for caviar that nathan caught right well yeah and just because the tape says a particular value for example yes you don't take that at face value either it you know trust but verify and and not that the seller is trying to pull one over um i've been on the other side of that table and you know what the seller just doesn't know they they got this spreadsheet from a bank and so they don't know they know whatever the bank told them yes you know at best maybe the uh the seller went through well depending on the seller i've had sellers where they're they're trying to give me a zillow value uh and then i have other sellers that actually have done bpos and they'll provide ppo value and and some don't give a value at all and so it's it's anything in between so you're one of those things you have to check out and the caveat on the fact that knowing if it's performing or not um usually it's run through the next due date right um pay through date not last payment received except for the fact you have to make sure nathan caught this one really well one time that the date of the tape is equivalent to today or most recent right but the date of the tape or date the information is most accurate is three months old caveat right yeah and the next due date is you know three months old as well it's not actually not performing it's actually performing and the tape's just old yeah yeah i had that once and i got it i got really good deals on a few loans uh because it was just old data it wasn't it wasn't that they were not paying it was just old data and so i ended up getting a great deal on those which was happy day yeah so let's you know unfortunately we weren't getting a lot of tape uh we didn't get any assets from people and those who are curious about setting us assets know the fact that we're not gonna share any other details besides the upb the interest rate the numbers um and the property itself we can pull per privately and get a value right i would use my due diligence portal um to pull that information out finding out the last pay a less you know listed price lasted all information it was foreclosure i would get that information from that i don't want to know who the seller is we don't even we'll grab your name just we know who it is however we won't ever reveal your name because if you're to mail that deal we don't want anyone knowing about that so um in terms of the address we don't either for valuation we would not give it out right um as long as you're comfortable with that we would be willing to break down the deal i would think that you know we would even close out the fact that what city it's in so no one knows what kind of deal it is where it came from because it's not about the deal um where it came from details it's about breaking the numbers right yeah we'd love to see what deals you're coming across and help you evaluate them yeah and we're not trying to steal anything no and and you know you talk to any node investor and they will tell you everything you want to know except that one thing that's the only secret in node investing is where you get them so that's that's taken very seriously yeah yeah and because if you have a great source uh we're gonna beg for it but you better not give it up right that's the whole point of it that's the only caveat that we don't share and me and nathan's done this all fair which is really cool right like and we see things differently so we wanted to show a screen let me uh make sure i can bring it up correctly um and this will kind of show you a nice idea of what we're looking for so um i'll have the chat open for those who um are curious and then we'll go from there make sure the chat's open okay so all the chat open um if we have done you i will um but we'll go from here so we have a few deals here that we're looking at we've blanked out there like like the loan number and address uh again just for privacy concerns i want to make sure that we're not yeah stepping on any toes anywhere right so um what we want to look at affected um make sure one thing give me one second guys so nathan when you're looking at this stuff too um what is something that stands out to you that you think i gotta to either like it not like it i really want it um you know what are some of the things that that sound to you say well this acid's really good man oh man there there's all kinds of things so um things like uh when i'm looking at a tape i'll look at the interest rate for example if it's uh one that's recently non-performing and by recent i mean sometime in the last 12 months if it's got a higher interest rate i'm much more interested in that yes because the chances of that person making payments again is much much higher so i'm much more interested in that if it's uh let's see if it's got if if there's a diff a large difference between uh equity like if there's a big equity gap whether positive or negative so if the upb is much lower than the value or vice versa uh i like those that i can find a lot of good value in those things where where it's a lower upv and higher value or vice versa where it's a high upv and a lower value i like that kind of a deal it gives me more options when i'm working it later yeah the interest rate to me is a huge thing i'm not apologize to being distracted i realized we had some borrower numbers in there okay i was distracted to black those out so we don't have those in there so for me if i'm looking at and we do this in our mastermind weekly class we have a way to interest rate most people don't look at interest rates for some reason um understand the fact that with a two percent interest rate um you know your p9s be low if you're looking to get a say a 10 yield you can't really get it two percent to a 10 without a dramatic decline of price your bid has to be dramatically lower because that two percent's really your your gross yield so tracking servicing fees you're probably one and a half now to bid that you have to be dramatically lower now it's a 10 it's a lot easier so the only the only time that that is not a factor is if it's been non-paying if the let's say the last date paid and the last time that they made a payment the last payment made is like two or three years ago if it's been two or three years since they've made a payment and their interest rate is at two and a half percent i'll look at that yeah because there's almost no chance that they're going to start making payments again or reinstate that so that two and a half becomes less important not necessarily because completely the reason we care about interest rate is a for performing loans and b loans that could re-perform or reinstate right remember the fact that you can't modify a loan if they reinstate right if they're five six months behind they reinstate there's nothing you can do about that interest rate your p is gonna be what it is your monthly payment so again feel free to put comments in the chat i apologize for the the crazy facebook linkedin stuff um so let's dive into some of these numbers here and show you what we're looking at so there we go if you can't see something let me know if you can't hear anything turn your speakers off i guarantee you that everything's working so let's rock and roll with this so we have a few assets in here the first thing that stands out to me yeah in let's go d of ideal first right here's some numbers here so we're in iowa we're flying over iowa some people look at the stuff and say i'm going to do a google walk and they google walk-ins like that right for me i punch every one of these assets in my due diligence portal to pull out things such as i'll scroll over here bedrooms bathroom counts i will get uh last listed price lastly date and things like that if we can get that information i will if i can't i don't right um i like to know if it's foreclosure data i'd like to know that what it is so yeah that's good stuff well so one of the other things i look at state is one of those things and then and then i look at the city so in this case we've got fort dodge uh iowa i don't know much about fort dodge and never heard of it so i'll google it and see how big is fort dodge and for me anything with a population under 20 000 people is a no go unless it's like a suburb of a big big city or something like that and it's just outside of it and one of the things i'm trying to get in our pool is days of market right because that will outdo a low volume of people so if you only have 20 000 people or 15 000 but days of markets 45 days you know it's just it's going crazy something's happening there yeah where if the days of markets 300 days that tells me something differently right so let me ask you do you years ago i used to spend a lot more time looking at the specific city so if it was a let's say it was 25 000 people so it's just like kind of barely over my my threshold then i would go in and i'd start looking at the economy in that city what's the major business all those kinds of things i do that every once in a while if it's one that i'm really unsure about do you spend any time looking at that kind of thing i'm the same way you are it's a deeper due diligence number yeah right initially when i look at tapes i don't that's not a pillar because if the yield numbers don't work who cares right right but if it's like just barely over 25 30 000 people i'll start looking at that kind of thing and then one thing i'll look at actually is on the wikipedia page for that city it'll give me a lot of the time it'll give me population by year and like if i see you know 50 years ago it was booming and it's just been slowly dying this whole time then nope pass but if it's the other way around where it's gone from 5 000 people and then in the last 10 years all of a sudden it's growing growing growing excellent yeah so with that said i don't look at population at all in any of my numbers very interesting right um i look at values i look at less old and i depend on my my agents when i run my i don't run vpo but i run my valuations with reaching out to reo agents that's when they tell me what's going on and i look at himself because it's population is like crime a lot of people look at crime as a number i don't care of a crime right if it's in a really high crime area but people are buying houses do i care about the crime right no right but i get it some people want to have that there um but so in iowa situation here we have we have probably just here we have a upbeat of 112.

yeah right we have all these numbers here um was this the regular mortgage or this this one that the giveaway on this one is pni zero this means this one is a reverse mortgage so the borrowers are deceased and this is a reverse mortgage so the payment is zero the only play on this one is foreclosure really i mean you may be able to squeak out something else but really you're looking at a foreclosure on this yeah so the borrowers are gone uh we have our heirs right with the repertoire this is like any foreclosure um but that's where it's at and it's a reverse mortgage is a little bit different but it's the same idea they're actually getting money versus taking money in and that upb grows as the reverse mortgage goes so they're borrowing that um yes cindy there's a lot of low interest notes right now the same for portfolio for the fact that if it's low interest they're not their gain isn't great unless they bought it for a really good price yeah uh if you think of probably back population is important to look at absolutely um for me if the population is 15 000 but there's houses bought and sold every day and the day the market say 30 days i'm less caring about that population because there's movement right and get a feel for it yeah where you may have a population a really big population but no one's doing anything do you want to sell in a market that's dead or we want it to live so that's where i get from nathan on that again different perspectives right uh we see the fact that it's a pre-judgment idea we see a next due date remember this is not the last payment received the next due date in the amortization schedule right and then the fact that it's pre-judgment means that they've started foreclosure already uh it hasn't gone very far but it's something has started so that that's nice i can just kind of step into wherever the foreclosure left off all right so let's look at the fact that we have uh a year built is a year built by at all not generally before 1950 i start to think about it if it's like 1920 it kind of sorta i don't look at it too closely again same thing if houses are selling in the neighborhood i don't care if it was built in 1910 sure if everything's selling in the neighborhood so i don't look too closely at that how about you i care about it when it gets too old uh i'm more than you know sub 1930s that starts bothering me yeah because it becomes a problem it becomes a problem house unless it's been um you renovated or something different that's when the only time it comes about that that doesn't bother me so okay so let's continue here so we have a single family home with two bedroom one bath some people say i don't want any houses with one you know two bedroom one bath limits the people right again it depends on the housing in the area if everything's a two one in small area it makes sense yeah and we'll let my agent tell me a real hard population for this yeah and again for dodges i think population 23 000 people you're you're not finding as many larger houses there so a small house doesn't really bother me too much so we have a solution for this thing is underwater right we have a hundred fifteen thousand dollar balance we have eighty five thousand dollar value of the property so we're looking at the fact that we're gonna we're gonna be able to sell this thing for as much as we're gonna know it for right right so we're gonna have our bid based on this value yeah granted that's your byproduct we always talk about don't bid based on that number yeah i understand that's the number going to be focused on when you make this offer again based on your returns but the returns are going to be driven you know numbers will be driven by returns based on numbers and then it will be based on that collateral value because you can't bid 100 percent of upbeat on this thing it's not possible i don't care how high the interest rate is bidding 100 of this upb you're not going to get that much money when you go to auction yeah exactly this is definitely an auction play um versus take this property back because it's more likely unless you really want to and no one will bid it if the property's worth 85 grand and you make an offer at the auction for 80 more likely people will bid on it yeah you know exactly i i would much rather have it sell at foreclosure auction than take back a property my ultimate goal is not to own property i don't ever want to own property yep so if i can get this um unloaded at the auction that's ideal so in iowa uh i'm gonna bring my master foreclosure list i have a huge list of uh timelines costs stash limitations everything under the sun and kind of give you guys an idea of what we see or i see as a cost of foreclosure in iowa as well as how long it takes so look at this number i have 220 days for foreclosure right uh cindy vacant property to the plus minus we'll get that in a second um 220 days we're looking at approximately about two grand of foreclose on it that's give or take six hundred dollars in the fannie mae fee 1500 for a turn uh court auction and all that stuff that goes through it yeah and publication as well yeah and i like iowa it's it's not terribly expensive and it's less year what i'm looking for for closure is less than a year yep and and the redemption period is none from my knowledge if it is um cool it's a share of sold situation um and assumes super lean which is hoa which doesn't apply here no now uh let me bring this over to my station notations chart it says last pay received five years maturity's ten due date ten uh all the other pillars are are blank so one thing we care about is um five years from due date as you can see here 2019 we're well within that due date which is great and this all can be do a huge lookup table what not and rather usually what you can do sometimes is kind of push up due dates in certain states um and push them away all right vacant properties are often easy to foreclose on indeed blue right there's a there's positive and negatives for sure right you can get properties quickly vacancy you can get you lose vacancies uh user bars you test much however the property is bad if it's occupied the borrower can greatly modify reinstate but they also can fight your foreclosure they can trash the house um they can do a lot of stuff right they have that power so there's no right or wrong i agree with you so we're looking at this fact this thing here we're going to be bidding based on this kind of number the 85 thousand dollar as you can see that's payoffs a little bit higher than the update yeah and with the fact of being valuable 85 you have the fact that you're looking at probably about a year fully foreclosures a little bit less than a year nine months to foreclose get that property back in your hands and start doing something with it or sell at the auction right so you you could probably be a little bit high in this asset with that number right given the fact your costs come into play yeah yeah right so it's not bad i won't we won't go into exact bid numbers let's say oh oh oh oh oh bit of dollars you can see right here it's a dollar right so the dollar let me explain that actually what i do with that is i will sort my spreadsheet um by city and state and then i add a column i i rearrange all the columns to be the order that i like them to be in and then i'll add a column and i'll just scroll down and i'll just do a like a quick scan of each of the the loans on the on that tape and i'll be able to just say okay so i like this one i like this one i like this one i like this one so i might you know tag within a little number one i'll tag i don't know five or ten off of a tape and then i'll re-filter it so all those number ones come up to the top so then the ones that i'm actually interested are at the top of that list and then i can just deal with those ones and those ones are determined by state value those quick looks yep just quick looks and if if i really don't find anything maybe i'll i'll go through it a little bit slower and see if i see anything for real but uh but usually i can do it fairly quickly and just say yes for a couple years now well we're next assets something we all like first thing it pops off my head is texas right when i first got in the business i said listen i'll buy all texas notes and i'll be that person it makes sense to me until you realize that everyone else is the same exact thing yeah why is texas popular foreclosures cheap and quick yeah for code by lethal injection right so we have our counties which i'm not sure exactly where that count is at it's a different area that i'm familiar with but this one's it's not too far from houston it's a little bit uh southwest of houston uh which again when you're looking at location south southwest of houston uh that's kind of right in that hurricane alley and so that's that's a bit of a cause for concern not not even like concern but just awareness just to know that you know potentially you could be looking at some hurricane issues there gotcha so um for me you know texas is a great area um the downfall texas is when you try if you do a zillow look you're gonna find that you can't get numbers very different they don't report any numbers on their sales yeah um my due diligence portal can get some information from different places um so we're able to get some numbers but if you looking for that deep dive um it is uh gave says oh hey gabe uh as a restart state what do you mean by restart state i'm yelling like you can hear me about us hello hey gabe what do you mean by everybody over here yeah i can hear you over there oh awesome welcome leona gabe cass he's been around since we've been around so gabe what do you mean by restart state so every time the borrower files bankruptcy you have to restart the foreclosure okay right and pay for it all over again yeah that's fine so most places if you're in bk if ibk you can you can actually start from where it left off where texas doesn't allow that so that sucks the other caveat text is if if it's a heloc you actually have to do judicial process and do a full foreclosure luck they've never ran into that but lynette at a conference which is pretty interesting i have i've had that where i thought i was buying it first and technically it was but it was structured as a heloc so i went to foreclose and expecting a quick foreclosure and it took whatever it was six seven eight months so oh that's not what i thought i was in for but okay cool so we have something missing here which is difficult right um and sometimes we go back to sellers listen we can't run numbers on this right one of the key things um that i look to do is run um time value numbers on stuff well i'll be running a course soon how to do it in a spreadsheet but you can say okay how you know what is my yield number what is my present value number based that i return um but you need certain data points to determine what the loan is yeah if i don't know the first payment in maturity i or a term i don't know how long the term is right and i can't determine where they are on their organization schedule with just a next due date or what not so it makes it difficult to figure out how many payments are left and this one doesn't have any of that it doesn't have when it started doesn't have a maturity or due date or payment so we're we're missing far too much information to be able to make any kind of headway on this so it's kind of a pass but i wanted to include it just to show that like yeah you have to have certain pieces of information i remember a couple of years back somebody approached me and they wanted to broker a note which is fine but he came to me and he didn't it was kind of looked like this where he was missing a bunch of information i said okay well i need this this this and this and and he to his credit he came back and said so why do you need that information just so i understand so i said well here's why i went through it with them but uh but it's essential we have to have that information so we can put it together and see what the numbers are going to look like yeah so for those who may not be familiar uh i'll bring up the sheet for you um we just get the spreadsheet we're not looking there yep i'm gonna bring it over just okay so you should be able to see this yeah there it is okay and i'm going to show people how to build this thing uh future but what you can see here is i can run any number on here and figure out what my payment should be what my yield should be um based on putting in information right if i have a purchase price here and i want this is by bid number so i say okay i want it i want a certain return on a number what should i bid that's when it comes over to the pv section right and it says okay i a 10 return on this thing but i want it to be there's 180 payments left the payment 6565.87 my purchase price would be this granted this is for performing loans only right but it's a good way to figure out as you can see if i drop that rate down this number will change because the way that it's written up okay and that's what happens i have a servicing fee in here you can change it and then it'll come out that number so it's almost a net monthly payment uh return so that's what we're saying we can't totally do it with way it's at right now so because we don't have how many months are left we don't you know we need to have the interest rates we can figure out one if we have three right can't figure out any of them if we don't we're missing two right right so we're just missing too much information on that one yeah i'm i'm still interested so i this is the one that i brought so i'm going to go back to the seller and ask for some more information because i'm interested but i need more information all right next one we're looking at is in illinois first off the bat i'm off illinois is a state i'm not touching illinois is very difficult to deal with um peoria is only slightly better than cook and cook is better than hell like it's it's a terrible place to to work in it's just difficult difficult difficult not impossible and i don't want to you know say that it's completely remember guys if you're from chicago we're not bashing the city no the no legal process goes into it for foreclosure and things like that i don't do illinois you need a license first off in illinois uh mostly assets come up in cook county so it's almost pointless for me to do anything um and there are a couple calories in besides coke that are more difficult um for that fact it's not something i'm attracted to but yeah i agree but i did like the numbers so i wanted to put it on yes tell us about what you like about the numbers here so this is an example of one where the collateral value is higher and the unpaid balance or payoff is much lower so i like that um i like having that kind of flexibility um i i you know what i like it when they're even as well but i like having um that difference there because it opens up the doors so what i mean by that is if these guys start paying great then i've got excellent protection on that if they don't pay and i take the foreclosure uh there's a high chance that i'm going to get full payoff uh when it goes to auction there's a slight chance that i'll actually get the property back and in that case then i've home run grand slam home run ton of equity in this deal yeah yeah so so i like it for a bunch of different reasons but that's that's a few yeah and the fact that you can if this goes to auction all world happens and you get the asset back you gotta kill a deal however if they don't you're bidding up to the upb um and that's where we're going to be at yeah full on upside here uh you said the balance is the same as the balances so total balance and the upbeat probably the fact that they didn't give a full total balance on the asset or they're saying that the total which doesn't make much sense right gabe um that the total balance is equal so that it could be the seller just didn't give the right data yeah that's most likely but he's right because the due date is a couple of years ago that total balance number automatically that total balance shift number should be higher unless they're sitting there doing nothing but there should be a talk you know there should be taxes paid any kind of additional advances being made total balance is what you can totally collect according to the seller at the auction you have to be verified when you're buying it right uh we have interest rates right these two aren't too comfortably but they're better than two or three percent right um are these reverse mortgages or these regular stuff these are regular uh the other thing that uh that caught my eye on this that also makes it a no for me is it's a not a condo of condos i just why is that you've got condo associations um a lot of the time if there's a lien with a condo association that does not show up on a regular lean search um so you can get caught with some huge homeowners association condo association uh bill that you couldn't research and the only way that i know how to and if you've got a different way i'm open to it but the only way i know how to research that is to call the condo station directly yeah and most of the time but not always they will tell you what that number is and there are certain states uh that allow you to be maxed out long as you file the foreclosure correctly that you're not responsible for the additional fees like florida um i would ask your attorney if the state you're looking at allows or doesn't allow it because then you'd be maxed out at say six months um of whatever the each wee fees are and you're not uh held to that standard so right interesting i like condos you can hard fast value them it's easy to value um the roofs are connected so more likely the property's not destroyed to the point um because it's connected to another place if there's a real problem the condo association will probably maintain it somehow some way um and whatnot so yeah uh but yes delinquent hoa dues can be pain in the butt plus so one more thing with the hoa dudes is uh those keep racking up for as long as you hold it so i here as an example i had a note on a condo in dc and we were doing a foreclosure it was vacant and we had to foreclose and it the dc foreclosures are not simple either and so it just kept dragging on and dragging on and every six months i think three times so it took like a year and a half and three times i got hit with an hoa bill that i had to pay you know and it's which is ridiculous and just added to my cost and so yeah just to be aware and getting the cost of what the 28 fee is per month is sometimes difficult to get it's hard to get that stuff right so i'm not a huge fan uh what if the hoa is rented out in the vacant in the con vacant condo and that the hoa is still due no matter what is going on to the to the to the person who owns the property who has a debt on it so that continue to go there's nothing that changes who lives there or how structured that will continue to go build up um now the lender doesn't have to pay it but it will build up and whatnot it'll build up and if it's a super lean state like dc um they can go ahead and foreclose it was like 2 500 every six months but they can go ahead and foreclose uh and then i'm gonna have to pay not only that hoa fee but also whatever fees they've tacked on for attorneys and blah blah blah blah blah blah yeah city florida is a super lean state but it's not in the same essence um i'm not good at explaining florida's super lean process but it's like yes they are jump first position but not fully it's kind of confusing so yeah actually you know talk to aaron we can't tag her on facebook but and we're going to explain it really well so i wanted to anything else with this deal so i like the fact of the first right yeah um we have no data here at all that does anything i like i like some of the numbers on it but i don't like that it's in illinois first of all and i don't like that it's a condo so for me that's a pass but i wanted to just bring it in just for so one loan um another one we looked at is in montgomery alabama this loan here alabama the only down for alabama is there's a 12 month redemption unless the loan was created after 2016 and it goes to six months um so this alone that um i i think it's pretty cool the month payment is 197 which is quite low right this is a loan that if you're low in capital i'm looking to buy an asset why is the monthly payment low concern to me well because if i go and subtract 30 for servicing fees what happens there right they shop to 167 and how much is 30 out of 200 bucks right 15 it's a lot so it knocks a lot of the money out of the deal versus if there was a 700 500 payment yeah that's a killer but it kills your return again we're based on returns right now based on upb and that return will decrease because of that servicing fee so we're looking at a upb of 20 grand here again low but the value of the property is up so we're back in the same situation where we have we have equity room yeah like 50 equity that yeah numbers are low but if you're talking about 50 equity that's pretty good yeah so and this borrower from my memory was quite too close to re-performing fine uh taxes 73 hours a month a year which is crazy rejection 2005.

yeah um original mortgage is there next due date six one right okay um which means they're active they're they're actually current yeah at the time we did it right we look we've got it what does that mean right they're ahead of the game yeah so you may say well next two days must be 310. no they actually paid and they're caught up which is interesting to happen but it does happen that's pretty good yeah maturity is way out so to me the first thing that pops out here is the fact that i have a children's five and 243. that doesn't seem right so there must be a modification happen somewhere somehow that makes this make sense because for it to be makes sense even at 30 or 40 years the numbers don't make sense they don't do 43 and a half years right unless some crazy term that someone made and most likely not nine percent interest rate to me that's a very attractive number that's gonna help me get that number up it helps my p and i get higher and whatnot but if i ran numbers on it you probably find out that numbers may not match right um yeah summer state's 200 payments left right um occupy of a31 we have you're built um this all kind of comes from my uh internal to dealings portal if there's agents on it and whatnot and so forth uh let's penetrate again all data points if there was something here in my portal grabbed it with seven information um and whatnot so those are kind of three loans we looked at i like for you guys i love you guys to send over deals that you guys are evaluating and looking at and what we're due in the future is going to run us again hopefully and if people submit offers we can dive into it we want to get rid of the borrower's name get rid of you know any identifying information no strategy you send it to us a street address so we can kind of value the property um and value the property means diving into like a zillow our portal allows you to kind of run it gives you three avms it doesn't give you a zillow estimate but it gives you three values from three different sources plus the uh annual tax appraisal value so again it gives you stuff but it will allow us to say what is a cloud is this true is this not true because seller says this doesn't make it true please don't go off the seller's property value they're probably flipping somewhere um they pull multiple numbers that's where we want to look and say okay uh nathan what do you see the value is that and yeah we can do it hard where we dive onto different websites and value by comps or we can run evms quickly so you want to get the data we'll go through and do the same kind of thing what do you like what do you don't like and yeah and and what's worth it we're not going to give you what our bid price would be we're not going to say how we'd offer it we just look at the fact that what we do like about we don't like about it there's places in you know um ohio if you gave me a city and say you said well i was okay can you give me a county in ohio i'm gonna say i'm gonna be avoiding it like the flag right there's certain counties in certain states that based on our experience yeah of deals i had a bad experience nathan had a good experience but i had a bad experience and i wouldn't dive into that because of that county um time frames issues bond requirements things like that yeah yeah yeah um if anyone has any questions feel free to jump in here um all the states that i avoid california they're coming out with some new issues new concerns that really doesn't make me feel comfortable with the future of known investing in california um debt license requirements and bonds and whatnot um and keep impressed on what happens in that spectrum of debt licenses um because it's changing since covert um and certain states require like massachusetts used to require a original lender to show up not knowing that when you're foreclosing right that's a good problem they're doing that for me maine they're doing that in maine still and man what a pain there's a there's a work around so if you got something in maine talk to me that can help you do the work around but it's a pain yeah um and in places like jersey um i know that if it's vacant more than three years you can prove it you can fast foreclosure it's crazy um yes bond changes by county and city yeah absolutely now the bond in ohio is actually a property bond where they mow lawns they maintain the property and they just take money out of the kitty um they don't question it you have to put the thing right up it's a little bit different some counties enforce it some don't um yeah problematic um that's pretty cool stuff so does anyone have any questions curiosity or typical specific examples that you want me you want you i can open up the microphone or put in a chat that you had a question about something uh if you do i'll meet you or put in the chat um we're gonna i'm gonna bring up two more subjects but if no one has any questions we'll tune out for the day now when it comes to status limitations um i mentioned before there are certain ways to get around statisticians yeah um but what you can do is you can ask the seller um what is happening because that's invitation ran out doesn't mean you can't do anything it means i want more information to see what why it stopped right you know um what did you do to stop it if anything now if they start foreclosure that the time clock will restart because of that or you can push net due date uh and sometimes you do that and sometimes you don't um which states can you foreclose properly when vacant longer in three years um that's just new jersey law that's not a one state situation i know that's new jersey um you can do foreclosure faster in certain states if you do it through federal court which is the video on youtube if you haven't watched it take a look at that on our channel um feel free to if you posted the chat and if i can unmute you it's a long question i'll let it go through um but yes so vacant properties the new jersey law that comes about and i'll post it i can that law per se your attorneys will be that key for it um have you run to any kind of statutes issues nathan how did you handle it i have um nothing that's ever stopped me cold though um for example we had one in florida uh it was past the statute of limitations however it was it was kind of an interesting one it was a son and mother that were both on the the loan documents the mother had passed away the son was still living there um it was past the statute of um so to overcome that he was still wanted to stay and pay and it was much easier for him just to to uh kind of it wasn't actually a reinstatement but but get back on track so we did a modification and recorded the modification and then that reset the clock so he was back into normal and that was with our friend of her you know our good friend aaron quinn she helped me figure that one out so i was one i've had it where we've moved up the date um a few different things nothing's ever stopped me cold yet but uh but i definitely look at it and it's different in every state so you you know don't just think that because it worked this way in this state that doesn't necessarily mean it works the same way in another state yes yeah the statutes of state by state uh yearly i reach out to my attorneys and ask them for updates you'll see like you know tony sidal he'll say hey listen here's some new updates if anything's changed and and not even in the timing but even how you can deal with it in that sense yes so so that's different per state so make sure you check that out um yeah absolutely so the the there may be like in florida right years ago you couldn't do anything about satisfaction as if the time period ended however now you can push up the due date past to a point where it's no longer statisticians and father foreclosure and start over from there so pretty cool you have to forgive any kind of interest and some of that from before that but yeah it's key um so i'll jump to questions here if probably going to auction next week but none of the real estate sites have been indicated um what's the best way to advertise it um what have you done to advertise that something's going to auction yep i never have woo that's a great question i've never uh i've never i've done a few things i've joined facebook groups i've joined linkedin groups posted on groups that are local to that property yeah um hey i have an auction sale coming up here what we're doing i've also done craigslist where i've posted an auction date on craigslist um and anything like that i'll jump on um i also another way i do it you guys don't have the angle to do it and hopefully my portal will come out and be big enough to do this but i also reach out to investors who are local to the property and i'll email them out hey i have a property going to auction do you know any that may be injured here's my set amount this will the opening bid take a look at it oh that's um you know cindy said she sold nario on facebook marketplace nice right um but remember the fact that going to auctions is a little bit different most people will get confused why is real estate not have it listed i'm not sure exactly how zillow figures out if it's going off or not what data they're pulling um it may be an account they can't pull from i don't know i don't know vaughn asked is there somewhere a list somewhere about state licenses i encourage you encourage you i'm going to say there is not for a really big reason um watch our our youtube video on dead licenses it's not clear-cut um it depends what your company's doing how you're structured uh what you're what you're doing with the assets um there's a lot that goes into figuring out what states require a debt license for lenders require a debt license in that state yeah so it's not a clear cut um we have our internal list and i would love to share it but it's it's so difficult to do because it's based on our data and our property and our business um that's difficult unlike you know illinois requires a license no matter what um some states don't um in texas an example doesn't how active you are in that state that kind of thing so it really really depends so yeah so cindy said yeah cornerstone um we actually did the webinar with cornerstone yeah um if i can find that the youtube video on that it may be helpful um but that's what we let me uh stop sharing them so i think for you and blaming it's not an easy topic um to um to understand i'm gonna tell you i've watched a video a few times and i still don't fully grasp it because there's so many little intricacies and you'll see on the on the on the show that we did with them um it was very much a well it could be this or it could be that it could be that and it could be this and so at the end they just say just call us yep it's not a cheap thing that's the other issue with that um so let me see if it's this one should be is it just called cornerstone or i can change the neighborhood um no investing debt license there's an investor i'm not sure why it's name all that crazy stuff um but yeah and the i'll put in the chat here for you everyone um worth checking out for sure yeah yeah um i can change the name of cornerstone as well if it helps people but yeah take a look at this uh video it's not as clean-cut as you i would hope it would be yeah but take a look at it and uh take lots of notes um so it's it's a lot yep christie barters it will be in the video as well yep absolutely um any other question from anyone else so how will we look at things i in if hopefully we'll do this in the future again soon um on assets you guys are looking at um again we're not looking to steal anything we're looking to get you some ideas of what how we see things um and whatnot so yeah well we like what we don't like well we don't like positive negatives whatever and believe me there's deals where we explain a lot today but there's a lot of deals that we say oh well we don't like it for this reason and we haven't talked about it um it comes down to sometimes it's the county sometimes the state sometimes it's a value of the property sometimes the type of property like land i won't i won't even get involved with land some people do right sometimes the cfd which i'll i'm not a big cfd person if you're performing i run a number to see what my yield would be what i would have to bid to get that yield to be a certain dollar amount of performing and if that bid amount is less than 40 of my upb am i gonna make an offer to a seller like a bother so that come to play yeah so without any further ado we're going to let everyone disconnect me nathan they're going to chat for a few minutes i've stopped recording you hey everyone dave putz from jkp holdings nathan and i on this week's show broke down some note assets that we find very attractive or interesting we show you some issues some problems with some acids on tape we also show you some deals we liked we show you deals that we differ on some kind of opinion on what he may like what i may like may differ some things we agree on so this video was really good to do to show people what we thought you guys would learn from and maybe we can learn from it too hope you like it dave from jkp holdings nathan turner how are you man very very good you're a whole lot better now yeah we'll go from there so we wanted to kind of break down some deals we didn't get as many as i hoped uh from investors called zero so we're gonna break down our own deals um i have to record it go on youtube and everything else um and we wanted to show you guys how we see deals how we look at things which probably a little differently how you do it so um i'm going to see if i can get the crowd in here we have about 25 people uh live at that point um and see if we can come back in here and whatnot hopefully uh the sound should be perfect your direct linkedin and go from there so nathan when you get a tape how do you narrow that down do you go by states how do you narrow down your list so the very very first thing i do is i look at states so um there are when when in fact when i go out and buy notes if i'm going approaching a new seller they'll say what are you looking for and i'll i usually i just say i buy nationwide which is mostly true but there are some states that i don't like i don't like new york and new jersey i'm not a big fan of maine rhode island connecticut massachusetts kind of that whole new england area is really not good northeast is not a fun area it's not a lot of fun and the reason is because i'm always looking at worst case scenario which is a foreclosure and if it needs to go to a foreclosure those are some very difficult states to get foreclosures done and so and and you know what i learned by experience as well hawaii hawaii sounds all glamorous and cool man you get caught in a foreclosure and it just drags on forever yeah ask me how i know so we go by state right we filter states we don't like um and then what we do from there is we kind of say why do we not like to states is it the state illegal is it state because of uh debt licenses is it safe because of cost expenses those kind of things where is it that it's an issue um yeah yeah foreclosure is very very first thing foreclosure laws and time um but you're right things like licensing so for example georgia i i actually don't buy in georgia i love the laws that they have there as as in terms of foreclosure but i don't have a license there and i don't anticipate getting one and so it's just because it's difficult and it's an extra layer for those who don't know georgia has a law of five assets and you usually think your individual name and if you're a company um and if they catch you right it becomes a situation where you can be it's a family so it's a big deal um something we i veer away from myself yeah me too i steer clear yeah um so let's dive into what we look at very similar numbers right uh one of the first things we look at is states for us uh kentucky uh four thousand dollar plus a year debt license i'm not bothering no uh northeast i will look into new jersey i'm now avoiding pa new york up um pretty much um some plus new york entertained north west uh areas not the boroughs um and you know what i after our our interview a couple months back i am actually now looking at new york um but with a couple of of caveats like for number one there can't be a foreclosure already started yes there's a foreclosure already started i'm out um but but it's it's on my radar now at least and you know what only because we did this interview with uh yeah great taught us some things yeah yeah so if you haven't seen it definitely youtube check it out yeah so new york is back at least on the radar yes at least on the radar yeah so there's some quick foreclosure as long as you're not in that state you can do things video the process so for us the next pillar for me is i don't want any asset with a property value below 50 000 or above 300.

reasons is if i'm going to do any kind of kitchen work or foreclosure work and if it cost me five or six seven thousand dollars the value of the property means nothing in terms of foreclosure it's it's flat across the board and you could probably do the quick math five thousand dollars on a fifty thousand dollar assets ten percent if i'm losing it like that so lower price assets is something we um aren't attracted to the reason we don't do above 300 000 is the the person um typically is more experienced they have more money they have more abilities check out things um so we we kind of avoid that that issue of dealing with some facilitated buyers uh borrowers right so um and you can get you can check out the new york laws which isn't strictly for new york but our youtube channel which this will also be on um so there are some pillars that are coming about but you also have the debt license side of it which you have to make sure you you're aware of um you can watch our huge debt license video as well on youtube which is really intriguing and it's not a clear-cut answer right um but we would like to narrow down the list of what we see we are comfortable with i'm about 14 or so a little bit more than that but we primarily look for those kind of things the next pillar we look at for me um is either first or second or cfd right if it's a second lien um unless it's performing i'm gonna i'm gonna pull it out and just because the tape says performing doesn't mean it's performing right except for caviar that nathan caught right well yeah and just because the tape says a particular value for example yes you don't take that at face value either it you know trust but verify and and not that the seller is trying to pull one over um i've been on the other side of that table and you know what the seller just doesn't know they they got this spreadsheet from a bank and so they don't know they know whatever the bank told them yes you know at best maybe the uh the seller went through well depending on the seller i've had sellers where they're they're trying to give me a zillow value uh and then i have other sellers that actually have done bpos and they'll provide ppo value and and some don't give a value at all and so it's it's anything in between so you're one of those things you have to check out and the caveat on the fact that knowing if it's performing or not um usually it's run through the next due date right um pay through date not last payment received except for the fact you have to make sure nathan caught this one really well one time that the date of the tape is equivalent to today or most recent right but the date of the tape or date the information is most accurate is three months old caveat right yeah and the next due date is you know three months old as well it's not actually not performing it's actually performing and the tape's just old yeah yeah i had that once and i got it i got really good deals on a few loans uh because it was just old data it wasn't it wasn't that they were not paying it was just old data and so i ended up getting a great deal on those which was happy day yeah so let's you know unfortunately we weren't getting a lot of tape uh we didn't get any assets from people and those who are curious about setting us assets know the fact that we're not gonna share any other details besides the upb the interest rate the numbers um and the property itself we can pull per privately and get a value right i would use my due diligence portal um to pull that information out finding out the last pay a less you know listed price lasted all information it was foreclosure i would get that information from that i don't want to know who the seller is we don't even we'll grab your name just we know who it is however we won't ever reveal your name because if you're to mail that deal we don't want anyone knowing about that so um in terms of the address we don't either for valuation we would not give it out right um as long as you're comfortable with that we would be willing to break down the deal i would think that you know we would even close out the fact that what city it's in so no one knows what kind of deal it is where it came from because it's not about the deal um where it came from details it's about breaking the numbers right yeah we'd love to see what deals you're coming across and help you evaluate them yeah and we're not trying to steal anything no and and you know you talk to any node investor and they will tell you everything you want to know except that one thing that's the only secret in node investing is where you get them so that's that's taken very seriously yeah yeah and because if you have a great source uh we're gonna beg for it but you better not give it up right that's the whole point of it that's the only caveat that we don't share and me and nathan's done this all fair which is really cool right like and we see things differently so we wanted to show a screen let me uh make sure i can bring it up correctly um and this will kind of show you a nice idea of what we're looking for so um i'll have the chat open for those who um are curious and then we'll go from there make sure the chat's open okay so all the chat open um if we have done you i will um but we'll go from here so we have a few deals here that we're looking at we've blanked out there like like the loan number and address uh again just for privacy concerns i want to make sure that we're not yeah stepping on any toes anywhere right so um what we want to look at affected um make sure one thing give me one second guys so nathan when you're looking at this stuff too um what is something that stands out to you that you think i gotta to either like it not like it i really want it um you know what are some of the things that that sound to you say well this acid's really good man oh man there there's all kinds of things so um things like uh when i'm looking at a tape i'll look at the interest rate for example if it's uh one that's recently non-performing and by recent i mean sometime in the last 12 months if it's got a higher interest rate i'm much more interested in that yes because the chances of that person making payments again is much much higher so i'm much more interested in that if it's uh let's see if it's got if if there's a diff a large difference between uh equity like if there's a big equity gap whether positive or negative so if the upb is much lower than the value or vice versa uh i like those that i can find a lot of good value in those things where where it's a lower upv and higher value or vice versa where it's a high upv and a lower value i like that kind of a deal it gives me more options when i'm working it later yeah the interest rate to me is a huge thing i'm not apologize to being distracted i realized we had some borrower numbers in there okay i was distracted to black those out so we don't have those in there so for me if i'm looking at and we do this in our mastermind weekly class we have a way to interest rate most people don't look at interest rates for some reason um understand the fact that with a two percent interest rate um you know your p9s be low if you're looking to get a say a 10 yield you can't really get it two percent to a 10 without a dramatic decline of price your bid has to be dramatically lower because that two percent's really your your gross yield so tracking servicing fees you're probably one and a half now to bid that you have to be dramatically lower now it's a 10 it's a lot easier so the only the only time that that is not a factor is if it's been non-paying if the let's say the last date paid and the last time that they made a payment the last payment made is like two or three years ago if it's been two or three years since they've made a payment and their interest rate is at two and a half percent i'll look at that yeah because there's almost no chance that they're going to start making payments again or reinstate that so that two and a half becomes less important not necessarily because completely the reason we care about interest rate is a for performing loans and b loans that could re-perform or reinstate right remember the fact that you can't modify a loan if they reinstate right if they're five six months behind they reinstate there's nothing you can do about that interest rate your p is gonna be what it is your monthly payment so again feel free to put comments in the chat i apologize for the the crazy facebook linkedin stuff um so let's dive into some of these numbers here and show you what we're looking at so there we go if you can't see something let me know if you can't hear anything turn your speakers off i guarantee you that everything's working so let's rock and roll with this so we have a few assets in here the first thing that stands out to me yeah in let's go d of ideal first right here's some numbers here so we're in iowa we're flying over iowa some people look at the stuff and say i'm going to do a google walk and they google walk-ins like that right for me i punch every one of these assets in my due diligence portal to pull out things such as i'll scroll over here bedrooms bathroom counts i will get uh last listed price lastly date and things like that if we can get that information i will if i can't i don't right um i like to know if it's foreclosure data i'd like to know that what it is so yeah that's good stuff well so one of the other things i look at state is one of those things and then and then i look at the city so in this case we've got fort dodge uh iowa i don't know much about fort dodge and never heard of it so i'll google it and see how big is fort dodge and for me anything with a population under 20 000 people is a no go unless it's like a suburb of a big big city or something like that and it's just outside of it and one of the things i'm trying to get in our pool is days of market right because that will outdo a low volume of people so if you only have 20 000 people or 15 000 but days of markets 45 days you know it's just it's going crazy something's happening there yeah where if the days of markets 300 days that tells me something differently right so let me ask you do you years ago i used to spend a lot more time looking at the specific city so if it was a let's say it was 25 000 people so it's just like kind of barely over my my threshold then i would go in and i'd start looking at the economy in that city what's the major business all those kinds of things i do that every once in a while if it's one that i'm really unsure about do you spend any time looking at that kind of thing i'm the same way you are it's a deeper due diligence number yeah right initially when i look at tapes i don't that's not a pillar because if the yield numbers don't work who cares right right but if it's like just barely over 25 30 000 people i'll start looking at that kind of thing and then one thing i'll look at actually is on the wikipedia page for that city it'll give me a lot of the time it'll give me population by year and like if i see you know 50 years ago it was booming and it's just been slowly dying this whole time then nope pass but if it's the other way around where it's gone from 5 000 people and then in the last 10 years all of a sudden it's growing growing growing excellent yeah so with that said i don't look at population at all in any of my numbers very interesting right um i look at values i look at less old and i depend on my my agents when i run my i don't run vpo but i run my valuations with reaching out to reo agents that's when they tell me what's going on and i look at himself because it's population is like crime a lot of people look at crime as a number i don't care of a crime right if it's in a really high crime area but people are buying houses do i care about the crime right no right but i get it some people want to have that there um but so in iowa situation here we have we have probably just here we have a upbeat of 112.

yeah right we have all these numbers here um was this the regular mortgage or this this one that the giveaway on this one is pni zero this means this one is a reverse mortgage so the borrowers are deceased and this is a reverse mortgage so the payment is zero the only play on this one is foreclosure really i mean you may be able to squeak out something else but really you're looking at a foreclosure on this yeah so the borrowers are gone uh we have our heirs right with the repertoire this is like any foreclosure um but that's where it's at and it's a reverse mortgage is a little bit different but it's the same idea they're actually getting money versus taking money in and that upb grows as the reverse mortgage goes so they're borrowing that um yes cindy there's a lot of low interest notes right now the same for portfolio for the fact that if it's low interest they're not their gain isn't great unless they bought it for a really good price yeah uh if you think of probably back population is important to look at absolutely um for me if the population is 15 000 but there's houses bought and sold every day and the day the market say 30 days i'm less caring about that population because there's movement right and get a feel for it yeah where you may have a population a really big population but no one's doing anything do you want to sell in a market that's dead or we want it to live so that's where i get from nathan on that again different perspectives right uh we see the fact that it's a pre-judgment idea we see a next due date remember this is not the last payment received the next due date in the amortization schedule right and then the fact that it's pre-judgment means that they've started foreclosure already uh it hasn't gone very far but it's something has started so that that's nice i can just kind of step into wherever the foreclosure left off all right so let's look at the fact that we have uh a year built is a year built by at all not generally before 1950 i start to think about it if it's like 1920 it kind of sorta i don't look at it too closely again same thing if houses are selling in the neighborhood i don't care if it was built in 1910 sure if everything's selling in the neighborhood so i don't look too closely at that how about you i care about it when it gets too old uh i'm more than you know sub 1930s that starts bothering me yeah because it becomes a problem it becomes a problem house unless it's been um you renovated or something different that's when the only time it comes about that that doesn't bother me so okay so let's continue here so we have a single family home with two bedroom one bath some people say i don't want any houses with one you know two bedroom one bath limits the people right again it depends on the housing in the area if everything's a two one in small area it makes sense yeah and we'll let my agent tell me a real hard population for this yeah and again for dodges i think population 23 000 people you're you're not finding as many larger houses there so a small house doesn't really bother me too much so we have a solution for this thing is underwater right we have a hundred fifteen thousand dollar balance we have eighty five thousand dollar value of the property so we're looking at the fact that we're gonna we're gonna be able to sell this thing for as much as we're gonna know it for right right so we're gonna have our bid based on this value yeah granted that's your byproduct we always talk about don't bid based on that number yeah i understand that's the number going to be focused on when you make this offer again based on your returns but the returns are going to be driven you know numbers will be driven by returns based on numbers and then it will be based on that collateral value because you can't bid 100 percent of upbeat on this thing it's not possible i don't care how high the interest rate is bidding 100 of this upb you're not going to get that much money when you go to auction yeah exactly this is definitely an auction play um versus take this property back because it's more likely unless you really want to and no one will bid it if the property's worth 85 grand and you make an offer at the auction for 80 more likely people will bid on it yeah you know exactly i i would much rather have it sell at foreclosure auction than take back a property my ultimate goal is not to own property i don't ever want to own property yep so if i can get this um unloaded at the auction that's ideal so in iowa uh i'm gonna bring my master foreclosure list i have a huge list of uh timelines costs stash limitations everything under the sun and kind of give you guys an idea of what we see or i see as a cost of foreclosure in iowa as well as how long it takes so look at this number i have 220 days for foreclosure right uh cindy vacant property to the plus minus we'll get that in a second um 220 days we're looking at approximately about two grand of foreclose on it that's give or take six hundred dollars in the fannie mae fee 1500 for a turn uh court auction and all that stuff that goes through it yeah and publication as well yeah and i like iowa it's it's not terribly expensive and it's less year what i'm looking for for closure is less than a year yep and and the redemption period is none from my knowledge if it is um cool it's a share of sold situation um and assumes super lean which is hoa which doesn't apply here no now uh let me bring this over to my station notations chart it says last pay received five years maturity's ten due date ten uh all the other pillars are are blank so one thing we care about is um five years from due date as you can see here 2019 we're well within that due date which is great and this all can be do a huge lookup table what not and rather usually what you can do sometimes is kind of push up due dates in certain states um and push them away all right vacant properties are often easy to foreclose on indeed blue right there's a there's positive and negatives for sure right you can get properties quickly vacancy you can get you lose vacancies uh user bars you test much however the property is bad if it's occupied the borrower can greatly modify reinstate but they also can fight your foreclosure they can trash the house um they can do a lot of stuff right they have that power so there's no right or wrong i agree with you so we're looking at this fact this thing here we're going to be bidding based on this kind of number the 85 thousand dollar as you can see that's payoffs a little bit higher than the update yeah and with the fact of being valuable 85 you have the fact that you're looking at probably about a year fully foreclosures a little bit less than a year nine months to foreclose get that property back in your hands and start doing something with it or sell at the auction right so you you could probably be a little bit high in this asset with that number right given the fact your costs come into play yeah yeah right so it's not bad i won't we won't go into exact bid numbers let's say oh oh oh oh oh bit of dollars you can see right here it's a dollar right so the dollar let me explain that actually what i do with that is i will sort my spreadsheet um by city and state and then i add a column i i rearrange all the columns to be the order that i like them to be in and then i'll add a column and i'll just scroll down and i'll just do a like a quick scan of each of the the loans on the on that tape and i'll be able to just say okay so i like this one i like this one i like this one i like this one so i might you know tag within a little number one i'll tag i don't know five or ten off of a tape and then i'll re-filter it so all those number ones come up to the top so then the ones that i'm actually interested are at the top of that list and then i can just deal with those ones and those ones are determined by state value those quick looks yep just quick looks and if if i really don't find anything maybe i'll i'll go through it a little bit slower and see if i see anything for real but uh but usually i can do it fairly quickly and just say yes for a couple years now well we're next assets something we all like first thing it pops off my head is texas right when i first got in the business i said listen i'll buy all texas notes and i'll be that person it makes sense to me until you realize that everyone else is the same exact thing yeah why is texas popular foreclosures cheap and quick yeah for code by lethal injection right so we have our counties which i'm not sure exactly where that count is at it's a different area that i'm familiar with but this one's it's not too far from houston it's a little bit uh southwest of houston uh which again when you're looking at location south southwest of houston uh that's kind of right in that hurricane alley and so that's that's a bit of a cause for concern not not even like concern but just awareness just to know that you know potentially you could be looking at some hurricane issues there gotcha so um for me you know texas is a great area um the downfall texas is when you try if you do a zillow look you're gonna find that you can't get numbers very different they don't report any numbers on their sales yeah um my due diligence portal can get some information from different places um so we're able to get some numbers but if you looking for that deep dive um it is uh gave says oh hey gabe uh as a restart state what do you mean by restart state i'm yelling like you can hear me about us hello hey gabe what do you mean by everybody over here yeah i can hear you over there oh awesome welcome leona gabe cass he's been around since we've been around so gabe what do you mean by restart state so every time the borrower files bankruptcy you have to restart the foreclosure okay right and pay for it all over again yeah that's fine so most places if you're in bk if ibk you can you can actually start from where it left off where texas doesn't allow that so that sucks the other caveat text is if if it's a heloc you actually have to do judicial process and do a full foreclosure luck they've never ran into that but lynette at a conference which is pretty interesting i have i've had that where i thought i was buying it first and technically it was but it was structured as a heloc so i went to foreclose and expecting a quick foreclosure and it took whatever it was six seven eight months so oh that's not what i thought i was in for but okay cool so we have something missing here which is difficult right um and sometimes we go back to sellers listen we can't run numbers on this right one of the key things um that i look to do is run um time value numbers on stuff well i'll be running a course soon how to do it in a spreadsheet but you can say okay how you know what is my yield number what is my present value number based that i return um but you need certain data points to determine what the loan is yeah if i don't know the first payment in maturity i or a term i don't know how long the term is right and i can't determine where they are on their organization schedule with just a next due date or what not so it makes it difficult to figure out how many payments are left and this one doesn't have any of that it doesn't have when it started doesn't have a maturity or due date or payment so we're we're missing far too much information to be able to make any kind of headway on this so it's kind of a pass but i wanted to include it just to show that like yeah you have to have certain pieces of information i remember a couple of years back somebody approached me and they wanted to broker a note which is fine but he came to me and he didn't ....