Today’s graduate call focused on the importance of ways for new investors to get started without needing credit for down payment money. David from Richmond, Virginia and Ana from Spokane, Washington both had input on this topic.
We first discussed that there are many ways to work in real estate in this manner and to bring in an good income. We mentioned Subject to the pre-existing mortgage. We discussed assignment of contract as well. We discussed briefly wholesaling of property but this does require some kind of financial backing to close on a property initially before selling it to another wholesale investor.
Ana had several questions though on how brokering of mortgage notes can work. She had confusion that it involved renting of property in some format but a more detailed explanation of the process clarified this to her and to others on the call.
It was explained that investors can find those individuals that hold mortgage notes, by investigating their own county records department. One can look at the public records to see all residential properties and their lien holders. When one finds those named that are not banks or another type of financial institution they likely have found an individual or group that holds a mortgage. In the call it was explained that these individuals can be contacted to see if they have interest in selling off the mortgage note that they receive monthly payments for and in return receive one lump sum. If so, the investor can then market the selling off of the mortgage to note buyers. The investor can then get offers from buyers, factor in their own broker’s fee also including the cost of a title company legally changing the name of the lien holder on the property. This proposal can then be given to the note holder who in turn can receive a healthy lump sum.
Dan Christiansen
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