Posted by Sean on April 08, 1999 at 12:31:16:
Well, I scanned the archives and didn’t find anything that cast bright illumination on the subject, but I think I already understand the basic idea.
Basically I buy a note at a discount and swap it with the mortgagee for face value. Since I don’t have enough cash to buy a note, I’ll need some financing, and that’ll mean getting a conventional loan from a bank using the property as collateral.
So my current plan is as follows:
- Get pre-qualified for a refinance loan.
- Find a note with acceptable terms.
- Approach the mortgagee with the idea.
- Tie up the note with an option agreement.
- Get the loan funded, and complete the deal.
Am I missing anything or am I going about this in the wrong order? How will I find a note? Should I approach those “I BUY NOTES” people in the paper to see if they’ll sell one, or is there a better way?