From

our blog.

What’s In A Rehab?.

March 26, 2018

Viking Capital Investments works with non-performing notes and the goal is to work with the mortgage holder to keep them in the property. Some times we have to take a property back through a deed in lieu, or foreclosure. We have been doing foreclosure rehabs also since 2001. Today I thought I would share what we do in a rehab and the process.

1. After acquiring a property it’s important to have all your measurements done so you can place your order for new materials in the house like doors, windows, cabinets, trim, etc. The permits for any changes to the structure of the house and to start any clean out and interior demo needed. Dumpster on property day one if needed.

2. After the demo is finished and framework is completed, the roughed in plumbing and electrical needs to be finishes and inspected. Doors,Trim and drywall needs to be in and completed.

3. Next step is interior paint, putting in vanities, mirrors, cabinets and countertops, and finish plumbing and electrical and all wall plates and outlets.

4. We usually have the outside landscaping, plants, trees, mulch, repave driveway, fence if needed and removal of dumpster at the near end.

5. Refinish flooring, install appliances, put in carpeting. The house is then profesionally cleaned.

6. Market and sell the property.

Those are the basic steps we follow through a rehab. There is more that goes into it than that but these are the steps that should be done in that order. Don’t be afraid of getting at least 3 quotes from each of the areas of work that need to be done and references are important too. Taking the time to get those from painters, plumbers and electricians can save you alot of money! You can see some of our rehabs and note deals on our Youtube channel.

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$75K Wholesale. Great Ranch. Great Area 1/3 Acre of Land!.

January 16, 2018

Hope everyone had a great weekend! I enjoyed the NFL playoffs and was not disappointed.

Wow! Talk about some wild finishes.

One of the deals we are working on this week is a foreclosure in a really nice area of East Peoria IL. It’s a brick ranch with 3 bedrooms, 1.5 baths, 1504 Sq. Ft. 2 car garage with a work area in the back. Full basement (1300 Sq. Ft.) on 1/3 acre of land. The property was built in 1960 and needs updating. We are looking to wholesale at $75,000 or rehab it with a funding partner at $100,000. ARV is about $150,000.

If anyone is interested or knows anybody looking to make greater returns on their investment secured by Real Estate, or are just looking for a great deal, give us a call for more information and talk further about this amazing deal at 855-508-4546.

 

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Webinar Replay. Some of our current deals including a ”Buying At 155K Selling At 355K” deal!.

November 8, 2017
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Buying at 155K. Selling at 355K, Interested?.

October 26, 2017

We usually don’t look at deals that have a lot of equity because they are harder to work, but this one has a lot of exit strategies. Noteholder has not made a payment in 3yrs. so the exit strategy is deed in lieu with a payoff or take to foreclosure. Property is a 2 flat in Chicago next to Rush medical center and just blocks away from the United Center where the Chicago Blackhawks and Bulls play,
The property was built in 1995 and each unit is a 3 bed 2 bath that brings in 1800-2000 each. This non-performing note holder owes 200k and can be purchased at 155k. If we just take the payoff of what is owed, that is a 23% rate of return. We are looking for a funding partner on this deal if anyone is interested, the property is worth between 350-450K. We will also be doing a webinar on Nov. 1st 7 pm CT on this deal and others we are working on right now. Sign up for the webinar here.

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Watch this Short Webinar Replay Interview With IRA Company iPlan Group.

October 20, 2017

Thanks to everyone who attended our webinar last week. We had Jill Banner from iPlan group (IRA Company) talk about how you can use your IRA to invest in mortgage notes. We have investors we are working with now that are doing that exact same thing in their IRA’s and making great returns with us. It’s important to diversify your portfolio, and notes are a great way to go. Check us out on Utube for more information on notes and click on the link below for the replay of our short webinar from last week. We will have new deals coming next week.

 

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Webinar 10/11/17 With IRA Company iPlan Group!.

October 9, 2017

The last few weeks we have been talking about how you can invest in real estate and mortgage notes with your IRA or 401k plans. On Wednesday, Oct. 11th at 7pm CT we will be hosting a webinar on these topics and more. We are happy to introduce the CEO Jill Banner of iPlan Group, a self-directed IRA company. Jill not only runs the company but also has been investing with her IRA in real estate for over 15 years, She is a hand on investor and has truly built iPlan Group for investors. Please join us for the webinar Wed. Oct. 11 at 7pm Central Time by clicking the link below.

Reserve your seat here! 

 

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Why Sell My Mortgage Note?.

August 9, 2015

Accepting payments on the sale of real estate might have made sense at the time, but circumstances change.

Many sellers discover they would now prefer cash today rather than the small amount that trickles in each month.

Here are just a few reasons people have sold all or part of their seller financed mortgage notes for cash:

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5 Reasons Owners Offer Seller Financing.

August 8, 2015

Why would a seller allow a buyer to make payments over time for the purchase of property?

Wouldn’t the seller rather get paid now and require the buyer to obtain a bank loan?

Here are 5 reasons property owners offer seller financing:

1. Reduced Marketing Times

What is the first thing a real estate agent does when property is not moving and has been on the market for 60 to 90 days? They reduce the price and add the tagline “price reduced” to all advertising and signs. Rather than reduce the price, it might be beneficial for the seller to offer financing. Buyers provided with financing can certainly pay full price in exchange for the many benefits they receive with owner financing, including the money they save by not paying expensive loan fees, origination fees, and points.

2. Increased Inventory of Prospective Purchasers

By offering owner financing, the seller increases marketability with a wider group of available purchasers. Statistics show that almost 40 percent of the American population is unable to qualify for traditional bank financing. While not all of the “unqualified” group would be an acceptable risk for owner financing, it still widens the market of prospective buyers considerably. Anyone who has added the words “Owner Will Finance” or “Easy Terms” to a For Sale ad or Multiple Listing Service (MLS) listing knows the phone will ring off the hook with interested prospects.

3. Reduced Closing Times

Another advantage of offering owner financing is substantially lower closing times. A closing involving a third-party conventional lender can take six to eight weeks while closing a seller-financed transaction through a reputable title company can take as little as two to three weeks. This is due to the reduced paperwork and less restrictive due diligence process.

4. Investment Strategy for Hard to Finance Properties

There are many properties that encounter financing difficulties including mixed use property, land, mobile and land, non-conforming, low value, and others. Investors realize excellent returns by paying a reduced cash or wholesale price on a hard-to-finance property and then reselling at a higher retail price with easy financing terms.

5. Interest Income

Why let the banks earn all the interest? Sellers can keep the property-earning income even after they sell by offering owner financing. For example, a $100,000 mortgage at 9 percent with monthly payments of $804.62 will pay back $289,663.20 over 30 years. That additional $189,663.20 (over the $100,000 mortgage) is power of interest income!

Work with Owner Financing Specialists

If considering seller financing, be sure to consult with a qualified professional to properly document the transaction.

It also helps to speak with note investors to gain insight on appealing terms and structuring techniques. This assures top-dollar pricing should you ever want to convert the payments to cash by assigning your note, mortgage, deed of trust, or contract to an investor.

 

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Payment Histories Increase Note Values.

August 7, 2015

Want top dollar when selling mortgage notes?

Increase the value with payment histories!

Keeping an accurate record of the payments received on a mortgage note is essential for knowing how much the buyer still owes.  This also establishes a record of their payment habits – with an added benefit.

The value of a note can be improved by presenting note buyers a verifiable payment history!

There are two main ways to keep track of payments on seller-financed mortgage notes: 1) outside serviced, or 2) seller direct.

Professional Mortgage Note Servicing

The first and easiest is to let a professional handle it. The payments are made to a third party servicing agent that keeps track of the balance and sends the money along to the seller. They will also send out the annual 1098 Mortgage Interest Statements and can hold original documents in safe keeping.

The DIY Approach to Collecting Payments

If a seller chooses the “Do-It-Yourself”’ method over a third party pro they will need to follow these steps:

1. Place original note and other original documents in a safe deposit box.

2. Make a copy of each check or money ordered received. Accepting cash is not recommended since it is hard to verify the payment history without a paper trail.

3. Deposit the payment and keep a copy of the bank record of deposit.  It is best to deposit each payment separately rather than combining with other checks.

4. Create a ledger or spreadsheet reflecting the date and amount of payments received.

5. Calculate the amount applied to interest, principal, late fees (if any), and the resulting principal balance. An amortization schedule or financial calculator can be helpful. Once calculated, record in the ledger.

6. Send out an annual statement to the buyer or payer along with the IRS1098 Mortgage Interest Statement.

7. Verify the real estate taxes and property insurance are being kept current. Consider establishing a tax and insurance escrow where the buyer pays 1/12th of the annual amount into a reserve account each month.

8. Send collection letters as necessary for late payments, lapsed insurance, or delinquent real estate taxes.

Why Note Buyers Want Payment Histories

When an investor agrees to purchase a note they will request a payment history. A verifiable payment history can improve the value of a note as it provides proof of timely payments. A payment history is considered verified when it is either provided by a third party or is backed up by the documents and records outlined above.

Unfortunately many sellers fail to keep track of the payments received. When they go to sell the note, contract, or trust deed they try to recreate the history from memory. Without any proof of payments received, a note buyer has to go on faith. Sometimes a payment history affidavit can substitute for a payment record but it still doesn’t add the value of verifiable proof.

Protect the value of your mortgage note! Set up a payment tracking method today.

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Safekeeping the Original Mortgage Note.

August 6, 2015

Can you easily locate the original mortgage note?

This important legal document should be kept in a safe place, and here is why!

The promissory note is a promise to pay or IOU from the property buyer. It spells out the amount due and terms of repayment. In legal jargon it is known as a negotiable instrument. Similar to a check, the original must be presented to collect or prove ownership.

If the seller desires to sell and assign the payments to a note buyer, the investor will ask for the original note to be provided at closing. The promissory note is then endorsed over to the investor. Similar to endorsing a check, the holder signs on the back of the note.

Sample Note Endorsement on Back of Original Mortgage Note

Pay to the order of, (Insert name of investor), without recourse.

 

Dated this ____ day of _______, 2011.

(Seller Signs and Dates)

Sometimes the note endorsement is executed on a separate piece of paper, also called an allonge. The allonge is then attached as a permanent rider to the original note. The endorsement enables the investor to prove they are a holder in due course, with the same rights of repayment as the original note holder.

An investor may also ask for the original recorded mortgage or deed of trust at closing. However, if this original is lost, an investor will usually accept a certified copy from the county recorder’s office.

A lost original note, on the other hand, can cause a problem. In most states the note is not recorded. If the original note becomes lost a note investor may ask for a duplicate or replacement note to be signed by the payer or maker. This means going back to the person that owes you money and asking them to resign. This relies on their cooperation and can cause delays.

The investor will also ask for a lost note affidavit from the seller or note holder, stating the note has been lost and it will be presented if found at a later date.

Some investors will consider accepting just the lost note affidavit with a copy of the original note.  However, this is increasingly rare as a lost original note can create problems foreclosing should the buyer stop making payments.

The best option is to avoid losing the note by keeping it in a safe deposit box or a fire and waterproof safe. Some sellers elect to have the original held by their attorney or a third party servicing agent for safekeeping.

Whatever method you choose, be sure to keep the original mortgage note in a safe place that is easily located!

 

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