Understanding Your Buyer

There are many Note Brokers, Note Finders, Note Consultants, and Note Specialist, out there that are working hard to either find notes, sell notes, or list notes for Buyers. I know I was one of them, grinding it out everyday, trying to find and broker note and just hoping that I can get the right one that I wanted my buyers to like and or invest in when I first started out, only to get some of my deals shot down because of situations like and tell me if this sounds familiar, credit is to low, its not in our target area, this is a flip, or taking to long to close a deal. So I wanted to discuss some of these situations with you, that way the newbie as well as the seasoned note broker can get a better understanding and or a refresher course.

 Credit: Some but not all buyers, will buy notes with low credit scores if it is in their target areas, why because that figure that if it is in their target area then if they have to foreclose then it will not be that much of a hassle, as well as they can purchase it at a lower discount because of low Fico’s. Also lets say that the score is low, but the equity is great (20% or better), then even with the low score that payor(s) is less likely to walk, as well as some buyers will buy the note because the payor(s) may have a low score, but they have been making regular on time payments for 2 or more years, this persons is less likely to walk as well. Please keep in mind that there are cut off points for this as well. Some if not all buyers will not buy notes if the scores are lower than 450 to 500 no matter what. I know that the majority of the time, you don't know what the credit score is until your buyer actually runs and or pulls the credit report, but we sometimes come across notes that has the credit score and this information can and will be a determining factor.

 Target Area: Talk to your buyer find out what their target areas are. This information is very helpful to you because, by knowing what areas and or markets your buyers are interested in can and will give you a faster response, as well as a better offer. The best way to know you buyers target areas is to talk to him/her, and ask the question, they will either tell you the places they are staying out of, or the only areas they are buying form at the moment. When you are armed with this information in hand, you will know before time who to submit the note to as well as receive higher offers and or bids.

 Flips: Simply put most buyers will not buy flips, unless it is in his/her/their target areas. Even then there is a number of determining factors, such as 

1. How long did you seller own the property before selling it?

2. What as well as how much rehab went into the property and what was the total cost of the rehab?

3. How much did your seller buy the property for originally?

4. What is the minimum your seller will take for the note?

 How long does it take to close a deal: It generally takes any where from 10 to 30 days to close a deal, but there are a number of determining factors that apply, such as?

1. Where the property is located.

2. If all the paperwork is in place ie note, title policy, insurance etc. 

3. Pulling and or running credit.

 All the factors above taking into consideration can be very helpful to a successful note deal, as well as if put into place can create a win-win for buyer, seller, and note broker/finder. The number one rule is Communication, if you just take the time to communicate with your buyer(s), you will better understand what they are willing as well as have the ability to do.

I thank you for your time as well as your consideration in reading my blog.

Sincerely,

Corey Bell

Note Financial Services