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Real Estate Notes
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These are the
most commonly held notes by private parties. These notes are
secured in many ways, depending in which state the property
is located. They can be Mortgages, Deeds of Trust, Wraps, All
Inclusive Deeds of Trust, Contracts to Deed, Land Contracts,
etc.
Their
marketability is determined by the lien position (first or
second) of the mortgage(s), trust deed(s), etc. and the value
of the property. The professionals refer to LTV
(loan-to-value) ratio. This is stated as a percentage of what
is owed against the property in relationship to its quick
sale market value. The lower the percentage the better it is.
Note buyers will not, as a
common practice, make a full purchase of any note that has an
LTV over 80% and/or a second mortgage or trust deed wherein
the first deed of trust is greater than two times (2X) as
large as the second. WE WILL BUY THESE! We have bought them
in which the first is fifteen times as large!!!
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