Finding and Buying Second Mortgage Loans with Daphne Wilson, Episode 116

Mortgage note investing is real estate without property management

Home owner pays the investor instead of the bank

Notes are available through note exchanges, note brokers, and organizations

Where to find notes to purchase: LoanMLS and ExchangeLoans

First position loans are senior liens

Second position loans are junior liens, usually less than the senior loan

Buys second mortgages, these are typically for home renovation loans

Spends $2,000 to $8,000 per asset

Unpaid principle of $25-$60k for non-performing notes

Banks would rather have bad loans off their books than try to collect the full amount owed

Strategy: Buys delinquent 2nd mortgage behind a current 1st mortgage

To get borrowers current on their mortgage, create a solution about the borrower

Use the arrears to create leverage

Spend 4-5 hours per month on note investing business

When purchasing a non-performing asset, you build a relationship

Arrears are the amounts that have accumulated because of missed payments

The 2008 market correction fueled the second mortgage investing space