Latest / Real Estate Note Investing / Episode 62: Your First 90 Days in Note Investing

Transcript

Episode 62: Your First 90 Days in Note Investing · Real Estate Note Investing

• 0:00
  SPEAKER_00: Welcome to the show, where you'll learn how to invest in mortgage notes, the savvy real estate investor's secret weapon to create cash flow without tenants and property acquisitions for pennies on the dollar.
• 0:12
  SPEAKER_00: My name is Robert Haitha, the founder of Fick Notes, and my mission is to make note investing ethical, profitable, and accessible for you.
• 0:20
  SPEAKER_00: In every episode, we're democratizing the industry to put these powerful Wall Street assets into the hands of mainstream investors like you.
• 0:29
  SPEAKER_00: So without further ado, let's get into this show where you're in good hands with my AI clone.
• 0:34
  SPEAKER_00: Let's go.
• 0:37
  SPEAKER_00: This program is for informational purposes only and should be independently verified before taking action.
• 0:43
  SPEAKER_00: The first 90 days of a note investing business are less about buying loans and more about building the foundation that makes buying loans possible.
• 0:50
  SPEAKER_00: Investors who skip the setup work and chase deals immediately tend to run into problems that could have been avoided.
• 0:56
  SPEAKER_00: Entity issues, no service are in place, sloppy due diligence, and sellers who do not take them seriously.
• 1:01
  SPEAKER_00: Investors who spend the first 90 days getting organized, getting educated, and getting their infrastructure in place, close their first deal with confidence and a system that can support the next one.
• 1:11
  SPEAKER_00: The first thing to establish is your purchase entity.
• 1:14
  SPEAKER_00: In almost every case, this means forming a limited liability company in your state.
• 1:18
  SPEAKER_00: Buying loans in your personal name is possible but inadvisable.
• 1:22
  SPEAKER_00: Your assignment of mortgage, the document that records your ownership in the county public record, is going to be in your entity's name.
• 1:30
  SPEAKER_00: That is a public record that anyone can search, including the borrower.
• 1:33
  SPEAKER_00: Having a company name on that record rather than your personal name keeps the right level of professional distance in place and protects you from borrowers who might otherwise try to reach you directly as an individual.
• 1:44
  SPEAKER_00: Forming an LLC is fast and inexpensive in most states, and it is the right first move.
• 1:50
  SPEAKER_00: One practical note on naming your entity.
• 1:53
  SPEAKER_00: Avoid using words like capital, investments, or financial in the company name.
• 1:59
  SPEAKER_00: These words can actually be a red flag for institutional lenders and community banks when you are approaching them as a loan buyer.
• 2:06
  SPEAKER_00: They can imply you are running a fund or raising investor money, which triggers questions you may not be ready to answer on a first call.
• 2:14
  SPEAKER_00: A name built around your geographic market, a phrase that reflects your mission, or even a neutral branded name will serve you better in the long run.
• 2:22
  SPEAKER_00: The second item to set up is your basic technology infrastructure.
• 2:25
  SPEAKER_00: You need a company email address connected to your own domain, not a generic free email account.
• 2:30
  SPEAKER_00: A domain and professional email can be established in an afternoon for very little cost, and it signals to every counterparty you contact that you are running a real business.
• 2:38
  SPEAKER_00: Alongside email, set up your CRM.
• 2:41
  SPEAKER_00: As we covered in an earlier episode, Podio is the most flexible and widely used tool in the note investing space.
• 2:48
  SPEAKER_00: Build your inventory application first, even if you have no loans to put in it yet, so that when you do close your first deal, you have a home for the data from day one.
• 2:56
  SPEAKER_00: The third setup item is your servicer relationship.
• 2:59
  SPEAKER_00: Do not wait until you have a loan in hand to find a servicer.
• 3:02
  SPEAKER_00: Reach out to two or three servicers during your first 90 days, review their fee schedules, understand their state coverage, and get your account set up in advance.
• 3:10
  SPEAKER_00: Most servicers have a simple onboarding process and there is no cost to having the account established before you have any loans to place with them.
• 3:19
  SPEAKER_00: When your first acquisition closes, you want to be able to give the seller your servicing transfer instructions immediately rather than scrambling to set up a new account under closing deadline pressure.
• 3:29
  SPEAKER_00: On the capital side, having around$50,000 available and documentable as proof of funds is a reasonable starting point for your first transactions.
• 3:36
  SPEAKER_00: You can enter this business with less, but having that level of capital available allows you to bid on individual second liens in a meaningful way and demonstrates to sellers that you are a Sears buyer rather than someone exploring the concept.
• 3:48
  SPEAKER_00: If your available capital is below that level, spend the first 90 days earning and learning.
• 3:52
  SPEAKER_00: Providing services to active note investors, cleaning data tapes, assisting with due diligence so that you are generating income and building your credibility as an industry participant at the same time.
• 4:02
  SPEAKER_00: Your first 90 days should also include consistent outreach to build your deal flow pipeline.
• 4:07
  SPEAKER_00: This does not require calling 50 banks in week one.
• 4:10
  SPEAKER_00: It means identifying the sellers you want to work with based on the type of loans you want to buy, drafting a short professional introduction email that explains who you are and what you are looking for, and beginning to send that message to community banks, credit unions, and other relevant sellers in your target markets.
• 4:23
  SPEAKER_00: One well-written introduction email sent to 10 relevant lenders per week creates a pipeline that begins to produce results within 60 to 90 days.
• 4:30
  SPEAKER_00: Consistency matters far more than volume.
• 4:32
  SPEAKER_00: Use the time before you have active deals to study.
• 4:35
  SPEAKER_00: Work through case studies.
• 4:36
  SPEAKER_00: Listen to investors who have been doing this longer than you.
• 4:39
  SPEAKER_00: Attend an industry conference if one falls within the window.
• 4:42
  SPEAKER_00: The note investing community is small, collaborative, and genuinely helpful to people who show up with genuine curiosity and a professional demeanor.
• 4:50
  SPEAKER_00: The relationships you build in the first 90 days will produce deal flow, mentorship, and co-investment opportunities for years.
• 4:57
  SPEAKER_00: The goal at the end of 90 days is not necessarily to have close a deal.
• 5:00
  SPEAKER_00: The goal is to have a real business infrastructure in place, an active pipeline of seller relationships, a servicer ready to receive your first transfer, and enough market knowledge to evaluate a loan opportunity when one arrives.
• 5:12
  SPEAKER_00: If you have all of that, you are ready.
• 5:16
  SPEAKER_00: The first deal will come.
• 5:17
  SPEAKER_00: This episode closes out our foundational series on mortgage note investing.
• 5:22
  SPEAKER_00: Everything we have covered.
• 5:23
  SPEAKER_00: From the basics of what a mortgage note is to how to build, manage, and grow a note investing business, is a framework you can return to at any stage of your journey.
• 5:32
  SPEAKER_00: The depth is always in the details, and the details reward the investors who take the time to understand them.
• 5:38
  SPEAKER_00: Thanks for sticking around to the end, and thank you to my trusty Robot and the Fix Notes team for putting together another episode.
• 5:45
  SPEAKER_00: If you want to learn more and hang out with the real not AI version of me, join our free school community at school.com slash fixed notes.
• 5:54
  SPEAKER_00: That's s k-o-l.com slash f I X N O T E S.
• 6:00
  SPEAKER_00: In the meantime, we'll see you in the next episode.