Posted by John Merchant on August 19, 2003 at 11:26:14:
I’m going to comment on something you didn’t ask, as it’s critical that you protect yourself until you do get this refi’d, or do change the note so it is saleable.
First, who holds the title? Hope you do, as it’s your money on the line. If not, that would be my first move, to get you the deed, into your name, so you know what’s happening to it, and your partner can’t play any games with it.
If it’s not possible now to get the deed in your name, at least get a Deed of Trust recorded so partner can’t sell or convey without paying you.
And if you can get neither a Deed or D/T now, I’d advise getting a notice of interest recorded so partner can do nothing with this RE without your knowing about it.
On the issue of how best to rebuild the note so it is attractive to a note buyer, David Butler and Jon Richards are two of the best in the world at that, so maybe you want to direct your question to them specifically.
How to make my note sellable? - Posted by Bob Ridge
Posted by Bob Ridge on August 18, 2003 at 16:08:35:
I loaned an investor in Dayton 23K to buy a rehab property out of a bank’s REO department. We planned on a quick turnover of the property, so we set up a simple promissory note calling for a total balloon payment of 28K in one month, or 31K in two months.
Now that we’re past the two-month period with the property unsold, we’re trying to come up with options. No one seems to want to give her a refi loan, though her FICO score is decent with no foreclosures, bankruptcies, late payments, etc. She is willing to rent or lease option the property from me, but I’d like to get out of the situation quickly.
I was thinking of redoing the note in a form that would be attractive to a note buyer. Any suggestions on how to structure a note (years, interest, etc.) so that a buyer would be willing to pay me the full 31K for it? It would be secured by the property, which has appraised three times in the past few months in the 50K’s. Thanks in advance for suggestions…