Note Business Tip of the Month 

July 2011

For all new subscribers, Welcome! If you have missed any of Armstrong Capital's E-letters just click here to read our Archived Monthly Email Newsletters!

If you have a question you would like to see answered in this newsletter just email Jeff!

UPDATE on the issues: - When the SAFE Act came out it was unclear whether or not you could use seller financing on property other than your personal residence. We were told by a regulator that HUD was stunned by the 5000 comments we all sent. And we won! Their final rule says you can use seller installment sales on any of your properties.

More information on the issue is here: http://bit.ly/nxf0Jq
 

Please leave a comment on that page and also, even more important, go here and tell the Federal Reserve to exempt individual property sellers from the rule:

http://snipurl.com/AbilityToRepay

We need to make sure that the Fed gets the message as well.

Thank you for your help!

*Tip of the Month: 

       Did you know....

           Overlooked by many, one of the most critical components of success in the note industry is calculator skills and understanding where the numbers come from. 

*Quote of the Month:

         " Originality exists in every individual because each of us differs from the others.  We are all primary numbers divisible only by ourselves."

                ~ Jean Guitton

*Question of the Month:

Q - Hi Mr. Armstrong,

        I am new to the note finding business but I have tried to do as much research on the topic as possible.  I have excel spread sheets sent by my county's deed recorder here in Chicago, of private transactions dating back to March, April and May of 2010.  Each list contains more than 4000 entries and the list comes twice a month. Of course they are not all viable but a great majority of them appear to be.  I see tremendous potential, and I love hunting the potential note holders down in the county deed recorder's records. I am very careful and thorough in researching the documents. While I am not afraid to call the potential clients I have identified, I want to be sure that I have a broker source that would indeed offer them, and me, honesty and fairness.  I am writing today to ask you if an individual note finder can earn $5000 a month?  From the Cook County files, the opposite appears to be true. Since I am new, I am as yet insecure.  Am I wasting my time? Can I make a living from it? An article I read said that it could not be done. I would like to build a viable business and eventually invest in buying notes. Is this naive? - Jacque

A - Hello Jacque!  Thanks for the email!  I'm sorry to contradict what you might believe to be reality but in the true note industry there is no such thing as a note finder. You are a note broker or a note buyer or you are not. You say you have a list of private transactions dating back to March, April and May of 2010, the truth is that those names and addresses are too old. Even if you did do a mailing to them your response would be minimal because they have already received dozens of other letters or postcards from others about their note.  4000 is not a lot, this business is a big numbers game. Most people starting out will send 1000 or so a month to get started and grow from there.  Those lists would pretty much be a waste of your time. Sorry, just being honest.  I work with note brokers all the time, as a Master buyer if we don't buy it I have a list of private and institutional investors that buy notes as well. I believe you are wasting your time looking up records on the county recorders website. If you want to do the business you need to get to the note holders within a couple of months after they carry back there note. After about six months old the response rate rapidly decreases. I use an excellent list company and the note holders that receive my first letter usually have it before they receive their second payment. A note finder can mostly make nothing. For a note broker it will take at least a year of continuous marketing to reach the $5000 per month mark.  As mentioned above the note industry is a real business that you need real time and real money behind you for real marketing to the note holders.  I would venture to guess that less than 200 people in the nation honestly make a living from it. Maybe you can be #201! :)  You are not naive at all, it is a very simple business but not easy. The person that wrote that article you mentioned said those things because the fact is that the note business is tough right now. Even when we get a seller to accept an offer poor credit and low appraisals have been killing deals left and right. Among other things, it takes commitment, persistence and a good marketing plan to grow and survive in the note business these days. Hope this helps! 

- Jeff

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Jeff Armstrong is President of Armstrong Capital. He is a member of the Million-Dollar Club, a Master Buyer, visiting instructor for the American Cash Flow Institute, instructor for Nouveau Riche and the author of several best selling industry books. He can be reached by calling 818-865-2322, faxing 818-449-4840, e-mail jeff@armstrongcapital.com, or visit www.armstrongcapital.com and click on "Note Brokers" for answers, articles and information about his services and how Armstrong Capital can help you succeed.

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