Most investors are now aware of lawsuits regarding banks and their legal right to foreclose on properties due to robo-signing and MERS-related issues. Hopefully, you’re not one of the investors currently stuck in litigation as some lawyers are purposefully targeting trustee sale properties. The verdict remains unresolved on many of the issues. CEOs from many accused firms are busy testifying in front of Congress and submitting to internal audits by state and federal officials. In the meantime, as investors, it’s important we do the best we can to stay informed and protect ourselves.
Trustee sale buying became a major player for California real estate professionals in 2010. It’s no secret that 2011 and 2012 is locked and loaded to provide much of the same opportunity. The only thing that slows down most trustee sale buyers is lack of cash. And now, new issues with the foreclosure process means more potential risk than ever before.
The Norris Group is currently refinancing trustee sale purchases for both partnerships and individuals purchasing at the trustee sale in Southern California which helps solve both these issues.
Leverage allows investors to greatly increase buying power and annual yield. Adding title insurance with a binder while refinancing with The Norris Group protects you and your future buyer. Look at the numbers below to understand how The Norris Group can become an important part of your team.
Trustee Sale + Hard Money
Trustee sale example below is calculated using purchase price at 80% of after repair value (ARV), minus repairs, and assumes a 120 day hold period.
Using hard money and leverage increases yield from 45% to 77%. Since only a fraction of your money is in each deal, it allows you to triple the amount of deals you can buy.
Increased volume has several other benefits most may not even consider including:
- * High volume = Greater annual returns
- * High volume = Diversification and less risk
- * Higher volume = Lower repair costs from contractors
- * Higher volume = More marketing exposure
- * High volume = Consistent cash flow
- * High volume = Lower insurance rates (this one can save you thousands)
- * High volume = Better cash flow
Imagine what you can accomplish in one year with a funding partner (and title insurance for added safety)! While much of our hard money loans have been in the REO and short sale space for 2010, we see trustee sales picking and becoming a more predominant deal source in the coming year.
See our hard money and private money lending section of our website for more information on terms and our application.
