Note Buying 101 - Using Online Tools to Value Notes

On Note Buying

In today’s economy, news of defaulted mortgages have become a constant refrain. Despite the obviously negative tone you find in the reporting on this subject in the media, many people see the current housing situation as a once-in-a-lifetime opportunity to make money. Today, we’ll talk about one of the hottest trends in real estate investing now-the buying and selling of non-performing notes, i.e. defaulted loans.

Assuming that you’ve learned enough about note buying to want to get into the game, what would you say is one of most important elements in your note buying decision?

Note Buying 101 – The Basics

Let’s start with the basics. When you’re initially searching for non-performing notes, due diligence plays a major role. Take a look at any of the important decisions you make in your life. Don’t you always do your homework? Weigh the positive and the negative? Well, ask yourself, why shouldn’t you apply these same principles to your note buying business?

Exactly…there isn’t any reason why you shouldn’t.

Note Buying 101 – 4 Sources to Determine Value

If you are going to buy some defaulted mortgages, you need to know what those properties are worth. How can you do this? Here are a couple of tips on how you can evaluate those properties without leaving your home.

Your four best sources for estimating value on these notes, are:

1. Trulia.com

2. Realtor.com

3. Zillow.com

4. Local MLS data (from a local realtor)

Note Buying Online Research Tools

Let’s focus on the first three for now. Each of these online sites allows you to research comps near your property, or real estate note, all from your computer, without leaving home! You can access recent listing prices, average sold prices, and how long the properties have listed before they were sold. All of this information can give you insight on what these properties (that are attached to your non performing note investments) are worth.

In one online session, you have strategically estimated the value of the property and therefore, your note investments. You know generally what the real estate note is worth and furthermore, a price that you should offer.

Note Buying 101 – How to Buy Notes in Today’s Market

Buying non performing mortgages isn’t rocket science. With the correct guidance and knowledge, you can profit in today’s real estate market. Knowing what actions you need to take and how to perform them is a step in the right direction. As with any investment, know what you are investing in. Determine the value on those notes!

Note Buying 101 - Using Online Tools to Value Notes