We all know opportunities abound from "Distressed" parties in todays market. By "Distressed" parties, I am not referring to homeowners. We have all dealt or heard stories about banks losing paperwork,short sales taking 2 years,restrictions on re-sale,non-assignable contracts,per diems and "fines" for not closing on time, the list goes on and on.Somewhere along the line we have been taught to only deal with "Motivated" sellers,but for some reason, even though the banks are really the"Distressed" (I sympathize with the homeowners plight,but they are living for a reduced cost or free) the banks do not seem really motivated because they are still in denial. Many Real Estate Entrepreneurs and Investors spend countless hours,days,weeks,months and even years dealing with "Unmotivated Distressed Banks" and get frustrated.Thats why whenever I have a "short sale" I outsource to specialists.
What seems to be overlooked today are "Motivated Sellers" that are not in Foreclosure,behind on payments or "not underwater". People that need "Solutions" to their real estate "Problems" abound. Believe it or not, almost 40%+ of all properties are also "Free and Clear". You can buy/sell/option/lease/flip in weeks if not days without dealing with the banks !!!
I strongly encourage everyone to learn techniques which fall under the umbrella of "Creative Financing"
Pete Fortunato is holding a workshop in October, he has been dubbed "The Millionaire Maker" for teaching countless successful people these techniques of acquistion and dispostion of Real Estate without banks.
Thanks for reading,
Winston
Comments
Beyond this, though, is the fact that the banks are unmotivated because it's not their money. They made back their initial investment on your mortgage note when it was sold to the secondary market. They are still collecting the servicing fees. The note holders are now the government, insurance companies, or groups of private investors, hedge funds, who operate the secondary market. It's not their money they are playing hardball with. They get their fees no matter what. It's the secondary market investors who are being hurt- not really- only the hedge funds.
The federal agencies and insurance companies have been bailed out. It's the private money that is having a problem. Ergo, no money for investors; or at least no reasonably priced money for investors.
If it was the banks own money on the line, you would see a whole different attitude. You can realize the difference when you have a transaction with a portfolio bank. They are very willing to negotiate very quickly at much better reductions in principle. And they will even restructure commercial loans to very satisfactory terms.
Your last part is spot on. Free and clear properties have no bank or other restrictions with regard to flipping, assigning, funding, etc. You negotiate directly with the owner who is usually very motivated, especially in the commercial sector.
And if you're wondering why the FDIC is not offering any great opportunities, it's because their inventory of properties is not distressed. It was the banks that were distressed, not the properties. They paid the FDIC insurance to the banks, and took their asset inventory. These properties, for the most part, are performing properties. So, they have no incentive to sell at fire sale pricing.
I want to add about Pete. He is one of the four who started this whole business of creative investing in this country way back in the 70's. Way before there was a Robert Allen, Carlton Sheets, Robert Kiyosaki, Donald Trump, or any of the others. This is a must come to event. There is NO ONE who knows what Pete knows and NO ONE who can tell it like he does.
See you all there,
al