Many incredible opportunities are out there today for a buyer of non-performing loans. However, as a new note buyer it is essential to break through the hype, get some real world experience and build on your education in order to make sure you are investing in quality notes and achieve the best return on both your time and money.
1. Get BankProspector for Discovering the Best Opportunities
BankProspector will allow you to see opportunities in the market others can’t. For example, any novice investors who are still chasing ever shrinking spreads on single-family and multifamily REOs while there is far more commercial and construction loan inventory out there ripe for the picking, has less competition and is likely to offer larger discounts.
2. Strengthen Your Negotiating Position
In addition to brushing up on your negotiating skills to become a better buyer of non-performing loans, dig deeper into the raw data directly from banks yourself to get the inside scoop on their positions and improve your bargaining power.
3. Hone in on Local Searches
Bigger banks and lenders are rapidly becoming more difficult and burdensome to deal with as a buyer of non-performing loans. Smaller regional banks get less acquisition offers and are normally easier to deal with in terms of getting through to decision makers. Local investments also mean you have a more intimate knowledge of your acquisitions and the direction they are heading in. You know the properties, owners, tenants and can quickly get a feel for local confidence and traffic. You may even buy notes that you know you will have to foreclose on but know that they are secured with properties that are turning around quickly and can offer large capital gains in the short term.
Invest in a system or source for developing your key contacts at lenders, servicers, and banks so that you can pick up the phone, get the info you need right away and cut a deal without having to wait on hold with customer service for hours or be transferred to a dozen people who can’t help you.