Banks and servicers sell non-performing notes to clean up their books. Not all banks sell non-performing notes but hundreds of banks DO sell each quarter. So do Mortgage Note Servicers.
There are as many reasons for a lender or a servicer to sell non-performing notes as there are reasons that notes go bad.
Banks sell non-performing notes to recapitalize, to avoid owning the real estate (for a whole host of reasons), because a loan no longer “fits in their box”. Sometime the “logic” of decision made by these institutions escapes me, but who cares, we are real estate investors. Banks selling Notes are the opportunity of the century. There are lots of reasons why banks and Servicers sell non-performing notes.
If you’re someone who isn’t afraid of doing the work and asking the right questions of the right people then you can buy non-performing notes direct from banks and Servicers.
When you take this approach to sourcing product instead of paying retail through the funds and the online platforms you’ll have an easier time raising money, you’ll be better positioned to broker, resell, or flip your notes and you’ll see higher profits from your deals.
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