Question for Michael Morrongiello et. al. on "Notes" - Posted by Marvin_AL

Posted by Michael Morrongiello American Note on December 17, 1999 at 10:56:10:

Call American Note TOLL FREE @ 800-659-2274 and ask to speak to someone in acquistions or a “buyer”. They are well versed in deal structuring and will be more than happy to assist you.

Please have facts ready when you call.

Also please note, that each transaction will be evaluated on the strength of its POSITIVES Vs the areas of concern and risk. The illustration provided assumed a “best case” scenario with a strong credit buyer, with good employment stability, 5% -10% cash down, and the note terms at the “off market” rate.

Michael Morrongiello
Operations Manager

Question for Michael Morrongiello et. al. on “Notes” - Posted by Marvin_AL

Posted by Marvin_AL on December 16, 1999 at 13:29:33:


I have seen your post on subjects concerning notes and you even answered a post that I had once. Thanks for the help. First let me say that I am able to find deals where there is 15% LTV consistently. Of course I would like 20% but that is another issue. I am hesitant at the moment to tie up these properties, as I do not want to become a landlord anymore than I already am (3 single-family residences). My question for you is this, strictly speaking of single family residences could I yield at least 8% profit selling a note to you on a simultaneous close? For example, let’s say that have a property that is appraised at 100K and I have 80K in the deal. I agree to sell to a buyer at 100K+/30years/5%dwn.

Second question, how do you construct a sell using a wrap mortgage and not invoke the due on sale clause?

Thanks for your time,

Marvin Nichols

Hopeful Investor

Use your “Noggin” to make money…(long) - Posted by Michael Morrongiello American Note

Posted by Michael Morrongiello American Note on December 16, 1999 at 15:16:07:

Assuming your already have closed on the property and acquired it for the $80,000.00 purchase price then It is posssible to do the following:

Sell it for its FULL RETAIL (FMV) Fair Market Value using an OWNER FINANCING technique to move that home FAST, noticed I said sell for FULL RETAIL value. DO NOT SELL FOR AN OVER INFLATED sales price.

Try to attract the BEST credit quality buyers you can. Confirm that they have strong employment stability and that they are capable of putting down AT LEAST 5% ($5,000.00) of the purchase price and perferably 10% ($10K).

Explain to them that you will Get them in the home FAST with a more streamlined and painless process than a traditional mortgage lender will require. That they will have to pay a sligthly higher “off market” interest rate on the financing, however there will be NO prepayment penalty in the mortgage so that after 12 month +/- of timely payments they should be able to refinance your mortgage to the VERY lowest rate loan they can qualify for …

Here is then how the deal shakes out:

Remember your acquired the home for $80K

Sales price to owner user buyers who have strong credit and employment would for $100,000.00

Sales Price $100,000.00
Down payment (5%) - 5,000.00
Seller held 2nd lien - 5,000.00 This 2nd you retain
Seller held 1st lien $90,000.00 This 1st is sold

TERMS of the $90,000.00 (90%LTV) 1st lien:
10.5% amortized over 30 years (360 months) payable $823.27 monthly P&I, no balloon payment and no prepayment penalty.

ANI will fund somewhere between 92% ($82,800.00) to 95% ($85,500.00) for a deal like this as a GROSS funding amount.

You simply pay off any underlying debt (this means that you do not have to do a wrap around mortgage) from these proceeds.

You Keep the following:

Buyers down payment $5,000.00
Cash from sale of note + $85,500.00
Sub Total of cash 90,500.00
2nd lien mortgage retained + 5,000.00
Grand Total $95,500.00

This seems to produce the 8% or more that your after by moving right through the property and quickly selling it.

American Note does deals each and every day like this. Call us to consult with one our acquistions dept. staff.

Michael Morrongiello
Operations Manager

Re: Use your “Noggin” to make money…(long) - Posted by martin Z

Posted by martin Z on December 16, 1999 at 15:56:38:

Hi Mike,

In the above example; say he didn’t purchse the property yet. Is there a way he could tie it up for several months and then sell it the way you mentioned. Using his profits to pay the original seller his asking of $80K? Does ANI do deals like that, or could they make something like that possible?
I’d like to hear your thoughts…thanks
martin Z

Re: Use your “Noggin” to make money…(long) - Posted by Bud Branstetter

Posted by Bud Branstetter on December 16, 1999 at 18:09:21:

You can also create an option contract to purchase with a closing date sufficiently in the future to give you time to resell. One of the problem that you can run into using the note funding technique is that you can not find a buyer with good enough credit to do the 90% funding. Most any will do 80% with reasonable credit. If you can’t wait and have to sell then all your profit is in the form of a note. If you wait and make payments on a note you eat into your profits. Some people will give you time to find a buyer. Others will not.

We will do them EXCEPT… - Posted by Michael Morrongiello American Note

Posted by Michael Morrongiello American Note on December 16, 1999 at 16:33:42:

As long as the “run up” in value is less than a 25% increase in value over the short term we will consider it. The transaction must be legitimate with “all the cards placed on the table…”. Where we run into problems is where the promoter of such a deal thinks he/she is going to “spoon feed” us the information and documentation in a covert fashion. This is a disservice to themselves and all the parties involved as If a transaction unfolds this way, it is VERY difficult to get comfortable with it and TEN times out of TEN times it will get rejected. It is much better to put all the issues out in the open UP FRONT.

We will consider your contractual agreement to acquire the property for $80,000.00 and then simultaneously sell it for $100K with an OWNER FINANCED purchase money 1st mortgage carried back. However since we are in essence putting up the funds to allow you to actually acquire the property we would limit our exposure into the property to not much more than what will enable you to purchase it. You will not get “Cash out”. The majority of your “profit” would have to be realized in the form of a 2nd lien mortgage that you could retain.

American Note is one of the few creative note funders that will even consider these types of deals.

We prefer to deal with a specific transaction, knowing the facts of the proposed acquistion, the resale, the proposed owner occupant buyer’s credit and employment profiles, their down payment, etc.

If you have a REAL deal to discuss call our office to work with one our account reps.


Michael Morrongiello
Operations Manager

LEad incentive program - Posted by martin Z

Posted by martin Z on December 17, 1999 at 12:47:52:

Hi Mike,

THank youfor all your continuous feedback and information. I find it very useful in helping my growth as an investor. There is nothing more valuable than knowledge! Thanks.

Anyway, I was wondering if you could tell me a little bit about the $1000 Lead incentive Program that ANI has. Or if not, could you tell me where I might find such info?

Thank you,
martin Z

Mike…what’s the number to your acquisition dept? - Posted by Marvin_AL

Posted by Marvin_AL on December 16, 1999 at 19:58:56:

I think I had too many math classes. I need someone to walk me through this. It could be the answer to my prayers!



Its EASY and SIMPLE - Posted by Michael Morrongiello American Note

Posted by Michael Morrongiello American Note on December 17, 1999 at 14:32:23:

American Note’s unique $1,000.00 lead incentive program is designed to allow new & seasoned real estate investors, RE professionals, Mortgage brokers, note brokers, etc. to take advantage of potential business that comes their way without doing a lot of work or risking any of their funds.

Simply register for the program. Call our office and obtain the $1K lead incentive program registration agreement.

We send you a special lead submission form to use. When a potential Prospect that you know is holding a seller financed note or may be creating a newly seller financed note. Your fill out the form and send it in to our office. We will acknowlege receipt of that submission and you will then be protected for your $1,000.00 fee for providing us that lead.

Our experienced staff will immediatly follow up with the prospect directly and attempt to deterime if a transacation can be structured, and negotiated. ANI will handle all of the processing, expense, and risk associated with the transaction. You have NOTHING at risk. You will get a confirmation that a deal is in progress if the seller & ANI reach an agreement.

IF and when the file closes you will be sent your $1,000.00 Fee.

NOTE: on larger transactions we many times will have a pre-arranged fee that can exceed $1K.

Its that simple!!! - you turn over the prospect to us and we do all the work at no cost or risk to you.

Visit our web site by clicking on the American Note banner above or go to; OR feel free to call us TOll FREE 800-659-2274

Michael Morrongiello
Operations Manager

If a note opportunity comes your way. You can