The other day I had a conversation with a new Note Buyer who informed me that after a long career in wholesaling properties, he was going to start investing in buying defaulted mortgages.
When he said to me "Dean, the reason why I want to get into buying defaulted mortgages is not only for the cash flow, but I want to keep these people in their properties. This is what worried me.
I do admit that Humanity counts, don't get me wrong. But...
Don't forget about the bigger picture here.
When Buying Defaulted Mortgages, Don't Only Focus On One Exit Strategy
It will not work.
You see, you may WANT to pursue A SINGLE exit strategy for the defaulted mortgages you purchase (in this case, he was looking to re-perform all the notes he bought - possibly by modifying them all - and then to hold them for cash flow).
How To Buy Defaulted Mortgages: Multiple Exit Strategies Are Needed
You have to be like Rafael Nadal in order to invest successfully in defaulted mortgages.
Nadal is a really well-balanced tennis star. He has an amazing serve, excellent grass court experience, plays solidly on clay, and can fire a wicked forehand.
You should have the same approach when you are buying defaulted mortgages. Have the ability to pursue multiple exit strategies at once in your note buying business.
Be careful you don't "stick yourself" with one note buying strategy.
When Buying Defaulted Mortgages, Use Foreclosure As A Tool
When trying to modify a loan, sometimes the only way to get a borrower to cooperate with you is to start the foreclosure action.
And Why?
Because for someone who has been missing payments regularly and hasn't been current for a while, sometimes a wake-up call with a foreclosure notice (combined with a helping hand from you to help them with a loan modification) is what prompts them to get their act together, take control of their situation, and to work their way out of their delinquency.
Be careful not to fall into the same trap as the investor I talked to.
If you want to be successful in your Defaulted Mortgage Buying business, 1 Exit Strategy is not enough.
You really need to be a jack of all 5 Exit Strategies to do well in the note buying business. - 21511
When he said to me "Dean, the reason why I want to get into buying defaulted mortgages is not only for the cash flow, but I want to keep these people in their properties. This is what worried me.
I do admit that Humanity counts, don't get me wrong. But...
Don't forget about the bigger picture here.
When Buying Defaulted Mortgages, Don't Only Focus On One Exit Strategy
It will not work.
You see, you may WANT to pursue A SINGLE exit strategy for the defaulted mortgages you purchase (in this case, he was looking to re-perform all the notes he bought - possibly by modifying them all - and then to hold them for cash flow).
How To Buy Defaulted Mortgages: Multiple Exit Strategies Are Needed
You have to be like Rafael Nadal in order to invest successfully in defaulted mortgages.
Nadal is a really well-balanced tennis star. He has an amazing serve, excellent grass court experience, plays solidly on clay, and can fire a wicked forehand.
You should have the same approach when you are buying defaulted mortgages. Have the ability to pursue multiple exit strategies at once in your note buying business.
Be careful you don't "stick yourself" with one note buying strategy.
When Buying Defaulted Mortgages, Use Foreclosure As A Tool
When trying to modify a loan, sometimes the only way to get a borrower to cooperate with you is to start the foreclosure action.
And Why?
Because for someone who has been missing payments regularly and hasn't been current for a while, sometimes a wake-up call with a foreclosure notice (combined with a helping hand from you to help them with a loan modification) is what prompts them to get their act together, take control of their situation, and to work their way out of their delinquency.
Be careful not to fall into the same trap as the investor I talked to.
If you want to be successful in your Defaulted Mortgage Buying business, 1 Exit Strategy is not enough.
You really need to be a jack of all 5 Exit Strategies to do well in the note buying business. - 21511
About the Author:
Want To Learn More about the Note Buying Business? We Offer Hours of FREE Training Videos here: Buying Defaulted Mortgages Real-life, Up-to-Date Information for You. Visit NoteBuyingProfits.com or Call 718-783-7605 Or Click Here: Buying Defaulted Mortgages From Dean Engle & NoteBuyingProfits.com - This time on Buying Defaulted Mortgages
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