Published on December 8, 2008
Week 3: Going through a Bid The 8 – Week Roadmap to Launching into Notes 1
Agenda Following the Roadmap Step by Step: Step-by-Step: • Understanding Bids • Key steps to building a bank relationship • Bid Stips Sti • Purchase and Sale Agreement • Closing on a Note – escrow & notes 2
Key steps to building a bank relationship • Review, review, review. Review review review Saprina and Janet • Step 1, Part 3 of the A-Z – really study it, along with Saprina & Janet’s interviews here in PAC 3
Key steps to building a bank relationship • Getting through: What’s the magic? • There is none … you p y pick up the p p phone and call! • Listen to the process Janet describes for Note Sales at her Bank: • Once / month • Sends a spreadsheet • You have two weeks to review • Confidentiality agreement (only document needed) • References – she asks for them (she didn’t check mine, didn t mine FYI) • Basic check #1: do you do what you say you will? y y yy • Basic check #2: do you pay what you say you will? 4
Key steps to building a bank relationship Once Through … How Many of “You” Are There? g y • 25 for this Bank • But ~10 active 10 • There’s a certain “natural limit” in managing relationships - about 10-15 people / i l ti hi b t 10 15 l investors t • Banks will check on the company you present yourself as: registered with S lf i t d ith Secretary of St t ? For t f State? F how long? Etc. • Th more professional you come across, th l The f i l the lower the hurdle to being accepted as “one of her investors investors” 5
Key steps to building a bank relationship Build the Relationship, Step by Step • Respond to EVERY communication • Even if you re not interested in the notes you’re • Don’t “bottom feed” – (more bidding tips in Step 3) • Listen up to the clue she’s giving on pricing – ranges on the “principal balance” (outstanding balance) principal balance • “Once you’ve established a relationship” – the Banker wants it as much as you do! 6
Key steps to building a bank relationship What Makes “the Best” Investor? • He buys the most … he’s trusted … he delivers • You’re listening to the 1R secret here … take notes • She mentions “relationship”, “honesty” and “trust” – simple and good business ethics … will get you far • A good relationship can beat out a better price • And the other thing about a good relationship … • always think “what does the Bank want to do?” … • sell them all … OK, so maybe I buy them all 7
Key steps to building a bank relationship Be Pro-Active • Sitting at a bank … there’s no “Investor’s Guide” • Reach out directly (note the other investors she mentions – you could try the Investor Approach…) • Banks wait for investors to call • Buying notes is more popular now, so expect that a Bank t B k gets more calls th b f ll than before • Confidentiality and references … and you’re in 8
3rd: The Bid Process • “Bid Stips” – What are they? Let’s Review • Purchase and Sale Agreement – what is it? • Note: sometimes bank will have one already • And: sometimes bank will never have heard of one! • (Next week: success by the “seat of your pants” – buying from a bank that doesn’t know what it’s doing) 9
4th: Escrow and Closing (next week) • What does it take to “close”? • An Assignment of Mortgage - recorded • How do you get it recorded? Well, let’s ask. 10
4th: Escrow and Closing (next week) From: Glazener, Liz [mailto:firstname.lastname@example.org] Sent: Wednesday, December 03, 2008 3:46 PM To: email@example.com Subject: RE: Questions re: Title Hi Dean, Here’s the answers to your q y questions – The recording fee is $9 for the first page and $3 for each additional page. I ran the date-down by my Chief Title Officer and she recommended pulling a new prelim report instead of this endorsement. That would cost around $360 and takes about 48 hours to produce. Also, we can’t issue a date-down endorsement on a seller carry back loan. We could on a construction loan, however. Another option for the Assignment of Mortgage once it’s recorded is to add on a 104.1 endorsement for a fee of $125 which ensures t e lender. e su es the e de Hope this helps, Liz From: Dean Engle [mailto:firstname.lastname@example.org] Sent: Wednesday, December 03, 2008 3:30 PM To: Glazener, Liz Subject: Questions re: Title Liz, What would the costs be to record an Assignment of Deed of Trust in San Francisco County? Also, if I wanted to order a date-down on a title policy, how much would it cost through First American (if First Am were the policy issuer)? i )? And finally, what about a title prelim - how long for San Francisco, and how much? Many thanks!
Wrapping Up • 3d down – 5 t go …. to • Complete that Checklist • Complete your Assignments • You are more than 1/4th of the way to launching your Note Buying Business! 12
Investor Teleconference – “The Breakthrough” December 10: 6pm PT, 9pm ET Join Rick, a new investor, and I in a teleconference - and learn how he taught the Banker about his own notes! Future PAC Sessions: December 17: Week 4 – Closing on a Note January 7 J 7: W k 5 – Th 5 Exits & F Week The E it Foreclosure l 13
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