Archive for November, 2015

What To Do After You’ve Rescinded Your Loan

Let’s say you’re behind on your mortgage and the bank has filed foreclosure. You look into it a little bit and you see that your loan was securitized and sold as part of a big bundle and has been traded around the banking industry for the last 5 years like almost every other mortgage out there. You decide you’re going to take action and, using the rules established in the Truth in Lending Act (TILA), you send a notice of rescission to the bank and anyone who might try to claim ownership of your loan. The 20 days have passed and all the bank has done is sent you a letter saying they’re not going to honor the rescission. If you’ve been reading my previous articles you know that holds no water, and that by operation of law your note and mortgage are void. You can now be expecting the bank to return your canceled note, remove it from the property records, and return all of the money you ever paid on the loan, right? Wrong. You still have more work to do.

While the Supreme Court has given homeowners some power back against the banks with the January’s Jesinoski ruling, the chances are you will still need to take the bank to court to enforce the rescission. You’re going to want to move quickly because after one year from the rescission, you lose all right to the money that you paid the bank for the loan. The mortgage is still void, but you’re never going to get your money back. On the flip side, after a year the bank can no longer collect any of the money that you received with the loan.

Once the 20 days have passed and you have filed suit against the bank to force them to comply with the rescission, they are going to use whatever tactic they can to get the judge to vacate the rescission. The banks are going to argue that they have standing to contest the rescission based on the note and mortgage. The problem for the banks, and what you might have to explain to a judge, is that the note and mortgage no longer exist. A claim of standing based on the note and mortgage must be denied.

The reason the banks are using this strategy of ignoring the rescission and then making baseless claims of standing using void notes and mortgages is simple. They cannot prove who the creditor was on any of these loans. In order to prove standing, they must be able to clearly show who provided the money for a loan, and all of the subsequent sales and assignments of that loan. Even if the judge bends over backwards to help the banks, as judges have been known to do, they will get overturned on appeal unless they can clearly prove who the creditor is on the loan.

Fortunately, the law has caught up to the banks and the Supreme Court has ruled as clearly as possible in the homeowners favor. Not only has TILA rescission provided homeowners with a powerful tool to stop foreclosure and stay in their house longer, it also creates an opportunity for investors to do some pretty amazing deals. The tides have turned and the banks are being forced to negotiate on our terms. No more begging the banks to accept our short sale and REO offers only to have them demand ridiculously high prices. We can now get the banks to the table and demand that they prove they have the right to enforce a loan.

This makes it more important than ever that homeowners and real estate investors act NOW. This is a massive opportunity for real estate investors. If you know of anyone with a defaulted or underwater note, you need to get in contact with my office immediately at (706)-485-0162. I have spent the last two years building up a team of experienced attorneys and fraud examiners/forensic auditors who specialize in exposing fraud committed in the mortgage process and using that fraud as leverage to negotiate the sale of notes. This opportunity is not going to be available forever; we need to strike while the iron is hot!

We have a huge opportunity to help homeowners and do some great deals with multiple exit strategies. For more information, call me at 706-485-0162.

Bob MasseyBob Massey is a recovering corporate executive who is now living the dream running his own successful real estate investing business and teaching others how to do the same. In the process he has become the nation’s leading educator on the foreclosure investing process.

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Commercial Deals Are Like Home Deals, And Here’s Why – Part 2

Last month we began talking about commercial properties. This month we will continue talking about opportunities you can find with small apartments, self-storage, large apartments, shopping centers, office buildings and industrial.

I think of my friend, Lance Edwards, who specializes in small apartments. Small apartments meaning anything from 4 to 100 units. In fact, Lance will be at our upcoming boot camp in August, and he will be at the summit in February. Lance is very successful in that small apartment niche.

And there’s self-storage. My friend, Scott Myers, is the king of self-storage, he has hundreds of units starting from scratch with no money or credit and has built an empire by buying and redeveloping or by buying land and building self-storage units on it, which has always been a hot commercial component in the market because even when people use their homes, they still need a place to store their Junk. Did you know that self-storage is the only type that you can literally get 100% financing on? That’s how much the banks think of self-storage. Scott will also be at my commercial boot camp, and he is a wealth of information when it comes to the self-storage business.

Most people who enter the apartment business start with small apartments and work their way up to large apartments. However, I have seen many people do the opposite and start with large apartments. There is plenty of money available for larger apartments, including HUD money. There is a program called the HUD 221 D that’s available to buy and renovate apartment projects, and if done correctly can be done with as little as 7% of the total capital needed coming from you or your equity partners.

Then there are small shopping centers, which I also kind of favor because once they’re rented the tenants don’t tend to move very quickly. Shopping centers can be bought all over the country at reasonable prices depending on where they are, especially if there is a management issue and/or a repair issue because the management is not taking care of the property correctly. Once you learn how to finance these shopping centers without having to come out of pocket, they may very well become your new niche. I know several developers who do nothing but shopping centers, and some of them have as many as 25 centers that they have accumulated over the years.

Then of course, there are always office buildings. This is a great time to buy office buildings because they seem to be at the bottom now, nowhere near the top. As long as you can construct the financing on these office buildings so that the cash flow can take care of them until you can turn them around and get them occupied they can become cash cows.

I even like closed-up, single-use buildings, like restaurants, that you’ll sometimes see free standing if you’re looking. Of course, if you’re not looking you won’t see any of these opportunities. Sometimes these free standing buildings are owned by individuals and great financing can be created on them since they are sitting there vacant and probably need some renovations, just like we do on houses. The worse condition of the property, the lower the price and the better the financing we can get from the sellers. These are also out there as bank-owned all over the place. If they are bank-owned, quite often we can get a really deeply discounted price because the last thing the bank wants is a closed-up restaurant sitting there. Sometimes they’ve been sitting there for one, two or three years with nobody taking them to the next level, so these become good opportunities for people who can see the future for these properties.

Then there is an opportunity that very few people are actually able to see: small tracks of land dead center of civilization. I mean tiny pieces of land located between two buildings or near a highly developed area that can be rezoned and converted to a much higher and better use. Maybe it’s an old building sitting in the middle of, or right near, new buildings that hasn’t been developed yet that needs demolished and or rezoned to a higher density. For example, an old building on a single level that has rezoned to a high-rise of six levels will literally take that piece of land and multiply its value by 10, 15, 20 times what you pay for it. Any time you can create more density on a track of land, you’ve drastically increased its value. And again, the good thing about rezoning a property is you hire other people to do the work for a very small amount of money. You do not have to be an expert or know the zoning department or even know anybody there.

I could go on for hours about the opportunities available in commercial property, and in fact I will in August. I will spend four days on it, and we will cover everything there is to cover about it. You can get information on that event from us if commercial property interests you. I will have some time to go through a lot of different types of projects, the good, the bad, and the ugly, because we will be working on projects that you bring to class after I train you on what to look for and what to bring.

Many of the deals we do don’t require money or credit. Some will, but if you don’t want to use your money or credit then I will show you how to get other people to put up the money, or credit, or both and you still get a big upfront payment from the deal as well as a piece of the action all the way through to the end. And in fact, I’ll even provide you with the contracts to make that applicable.

The ability to see the opportunity is the valuable piece. If a deal is good money, it’s easy to find, and that assumes that you are going to stay in the deal and care about raising the money to fund the project. Some of the biggest money I’ve seen made right now is made by flipping projects, many times without doing anything to them, like the rezoning we discussed earlier. They’re just like houses. When you can find them undervalued, you can put them under contract and flip them for their value. One good commercial deal can set you up for life. When you become a player the deals seem to come to you. I can help you become that player.

Ron LeGrandRon LeGrand is the world’s leading expert in residential quick turn real estate and a prominent commercial property developer. Ron has bought and sold over 2,000 single family homes over the past 30 years, and currently owns commercial developments in nine states ranging from retail, office, warehouse, residential subdivisions and resorts.

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