Q: What resources are people using to investigate / analyze notes (performing or non-performing) as investments?
I'm looking at notes on fciexchange.com - listings for performing, and non-performing notes. Recommendations I've read are to analyze notes there, then buy one and try the process out. Through internet searches, I've determined the homeowner's names, and occupations in these two examples. [Please comment, face punch, etc. ]
Several of the notes found on FCI (non-performing) look like big risks. But some of the 'performing' notes look interesting to me. Examples of notes below - first ruled out, 2nd a candidate for purchase & re-structuring.
My goal: restructure existing notes to become (or remain) performing, help the owners stay in homes they want to live in long-term, help owner re-build credit, and restructure at a price closer to the home value so the owner doesn't have the "my house is only worth half what I owe on it" impacting their payment decisions. Exit strategy: be comfortable enough with the note to be willing to take it to term. Otherwise, after 12+months payment history, re-sell the note at a profit. of Most of the non-performing notes I've looked at don't come anywhere near being where I'd actually consider a deal like this, but here are two examples of what I'm considering.
Note Examples (actual notes on FCI):
(Int=Interest Rate, UPB=UnPaid Balance, LTV=Loan To Value, Note Term=remaining years on original note, YTP=Years to payback note purchase)
1) Performing, Note Price: $71.2K, Note UPB: 110K, Int: 7.8%, Payment: $750/mth, House Value: $93K, Note Term: 20 yrs.
2) Performing, Note Price: $64K, Note UPB: 92.5, Int: 9%, Payment: $765/mth, House Value: $128.8K, Note Term: 22yrs.
Proposed New Note as re-structured:
1) New Note: $95K, New Int: 6%, Payment: 681/mth, New Note Term: 20 yrs, LTV: 75.5%, YTP=7.9yrs, Resale Price: $87K
2) New Note: $90K, New Int: 6%, Payment: 681/mth, New Note Term: 20 yrs, LTV: 71.9%, YTP=8.3yrs, Resale Price: $83K
First house looks trashy (Google), scattered, and old. Non-married long-term residents w/small business, and I would probably not bid on this note.
Second house looks clean, well kept and owned by a married window-treatment installer (blinds) with 3 store locations. I'm considering buying this note. After 10 years, the note will have paid $23K in profit (after paying off initial note price)