Yes - with the right source of funding - Posted by John Behle
Posted by John Behle on March 28, 2000 at 09:55:26:
I doubt you would interest any national lenders/buyers in this note. Even at that LTV, they still shy away from non-performing notes. Most broker or fund their portfolio in a manner that they would not want a foreclosure no matter what the LTV.
But… a private investor would have little risk in this. You could offer a great rate of return or a piece of the profits. You would just need to find or cultivate a private investor. Your first stop might be a local REI group, but I would have the note tied up first.
In a first position with a 50% LTV, the lender would have little reason to discount - but it doesn’t hurt to ask. They may not have a good idea of the value and might be aware of the condition.
Yet, it is likely they won’t discount, but may be very open to selling at face. You take the risk of no profit if the owner came up with the back payments or paid off the loan, but it doesn’t sound like they are moving too quickly to do that.
I would contact the lender and strike a deal on the note and then search for an investor. I’m the first one to be averse to making an agreement that you cannot yet perform on, but I would not worry too much here because finding an investor would be fairly easy.