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[ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] Re: A big, black box... Posted by Mark H. on April 26, 2008 at 8:04 PM In Reply to: A big, black box... posted by Rick, the Probate Guy on April 26, 2008 at 5:00 PM Many excellent points - all of which I will take into consideration. Thanks for the advice, esp buying the first. : Normally, you can't tell if there's a prepay penalty on the first with any certainty, as Tom suggested, because only the TD is recorded, not the Note. There are other clues and cues that can often lead you to fairly good conclusions. Prepay penalties are more likely to be found on: : 1. Neg am and adjustable rate loans, during the first 3 or 5 years of the life of the loan. : 2. Finance company loans : 3. Private party loans brokered thru a hard money lender : 4. Certain institutional lenders, who I will not list, are much more likely to have a PPP on their loan(s). : 5. Jr. TD's are more likely to have them than 1st's : On the other hand, loans made by private parties directly to other private parties may have all kinds of weird terms, many of which are not enforceable, but tell that to a private bene noteholder from whom you're trying to get a recon or assignment from, and you'll only jeopardize your deal. Check to see if it was insured by a title company that's currently in business [see why below]. : Frankly, I think that your biggest challenge will have more to do with the mindset and expectations of the private party holding the 1st. Maybe they'll be delighted to get some money now. Also, consider buying the note (in the name of another entity other than the one you hold title) rather than just getting a recon. This way, should you have a title problem, you can foreclose on that note and perfect title easier. Follow Ups: Post a Followup: Name : E-Mail : Subject : Comments: : Many excellent points - all of which I will take into consideration. Thanks for the advice, esp buying the first. : : Normally, you can't tell if there's a prepay penalty on the first with any certainty, as Tom suggested, because only the TD is recorded, not the Note. There are other clues and cues that can often lead you to fairly good conclusions. Prepay penalties are more likely to be found on: : : 1. Neg am and adjustable rate loans, during the first 3 or 5 years of the life of the loan. : : 2. Finance company loans : : 3. Private party loans brokered thru a hard money lender : : 4. Certain institutional lenders, who I will not list, are much more likely to have a PPP on their loan(s). : : 5. Jr. TD's are more likely to have them than 1st's : : On the other hand, loans made by private parties directly to other private parties may have all kinds of weird terms, many of which are not enforceable, but tell that to a private bene noteholder from whom you're trying to get a recon or assignment from, and you'll only jeopardize your deal. Check to see if it was insured by a title company that's currently in business [see why below]. : : Frankly, I think that your biggest challenge will have more to do with the mindset and expectations of the private party holding the 1st. Maybe they'll be delighted to get some money now. Also, consider buying the note (in the name of another entity other than the one you hold title) rather than just getting a recon. This way, should you have a title problem, you can foreclose on that note and perfect title easier. [ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] WWWAdmin 2.0a © 1997 Matt Wright and DBasics Software Company, All Rights Reserved

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