How to Buy Notes and Mortgages DOCUMENTING THE NOTE PURCHASE

How to Buy Notes and Mortgages
without using your own money
A Comprehensive Home Study Course by KENT J. ANDERSON
SECTION 303: EVALUATING RISK &
DOCUMENTING THE NOTE PURCHASE
TABLE OF CONTENTS
•
BROKERING NOTES AND MORTGAGES
TO INSTITUTIONAL INVESTORS
3-1
•
STATE LICENSING REQUIREMENTS
3-2
•
SECURITIES VIOLATION
3-2
•
UNDERWRITING REQUIREMENTS
3-3
•
CLOSING FLOW CHART
3-6
•
COMPARING RISK TO THE ITV RATIO
3-8
•
APPRAISALS
3-14
•
CREDIT
3-18
•
TITLE INSURANCE
3-21
•
DOCUMENTATION
3-37
•
CHECKLISTS
3-36
CASE STUDIES:
•
•
•
•
•
•
BROKER TO INSTITUTIONAL INVESTOR
PARTIAL SALE
DIVORCE PAPER
DEVELOPER NOTES
BROKER NOTE TO PAYOR
SELF-DIRECTED RETIREMENT
ACCOUNT TRANSACTIONS
• BUYING NOTES IN DEFAULT
• HYPOTHECATING A NOTE PURCHASE
• KEEPING THE LAST FEW PAYMENTS
SAMPLE FORMS BEGIN ON
© Copyright 2009 Kent J. Anderson www.NOTES101.com – All Rights Reserved
3-43
3-89
3-139
3-183
3-195
3-209
3-229
3-245
3-257
3-263
SAMPLE FORMS & DOCUMENTS
AUTHORIZATION
TO USE FORMS
The forms which are contained in
this publication are solely for the
personal use of the purchaser of
this publication. Permission is
hereby given to the purchaser to
use or reproduce any of the forms,
but such permission is limited to
the purchaser’s personal use and
for no other purpose.
The use or reproduction of the
forms for sale or use of others is
strictly prohibited.
Neither the author nor the
publisher of the materials
contained in this publication
should be considered as
providing legal, accounting, tax or
other such advice. Because the
forms contained in this
publication are of a generic
nature, the author or publisher
cannot assure that any forms use
in a particular situation is
appropriate, nor do they assume
responsibility for any forms use
in a specific situation. The
purchaser is, therefore, strongly
advised to seek their own
professional counsel for advice
relative to a particular set of facts.
Agreement — Escrow
Agreement — Broker agreement
Agreement — Whole purchase
Agreement — Whole purchase
Agreement — Standard purchase, straight partial
Agreement — Standard purchase, schedule partial
Assignment Trust Deed
Assignment of Promissory Note
Authorization to receive credit information
Authorization to release loan information
Checklist — at closing
Checklist — Future file – completed transaction
Checklist — Minimize Risk
Check list — Needed photo copies
Checklist — Neighborhood selection
Checklist — Note Submission
Checklist — Submission
County assessor questions
Cover letter to Underwriter
Deed of Trust
Direct Mail Letter—Attorney (Divorce,
Probate, Bankruptcy
Direct Mail Letter — Developer Approach
Direct Mail Letter — Developer Follow-up
Direct Mail Letter — Institutional
Direct Mail Letter — Private Party
Escrow Agreement
Estoppel — Original mortgage affidavit
Estoppel letter — Seller
Estoppel mortgage letter
Insurance notification letter
Interest — amount of interest paid this year
Note — Installment
Note — Colorado NTD 81-05-04
Note seller questions — letter
Note seller — Request for quote – fax
Note seller — information needed – phone
Offer A letter
Payments Past Due Letter
Pay off instruction
Payor notification letter
Payor verification letter
Personal Property Trust
Pre-Call Preparation Sheet
Recourse language
Request for Notice of Default
Senior lienholder letter
Trustee’s affidavit
Work sheet
2
4
7
10
12
21
29
31
32
33
34
36
37
38
39
40
41
42
43
44
50
51
53
54
55
56
59
60
61
62
63
64
65
67
68
69
70
71
72
73
74
75
80
80
81
82
83
84
© Copyright 2009 Kent J. Anderson www.NOTES101.com – All Rights Reserved