Banks Look To Unload Billions In Nonperforming Loans
Banks are working hard to offload billions of dollars in nonperforming mortgage loans. What does this say about the foreclosure crisis? Could this be the best source of deals for real estate investors? More importantly, how can investors find them and take advantage of them? Note investing has become a booming business, and from recent headlines there are many more notes out there for the buying than most realize. So what does this all mean for the average real estate investor? Billions in Mortgages Go Up for Sale Some real estate investors have recently complained of a lack of access to bargains and deals. Others, of course, have been making their own fortunes happen. The following figures show there are still more potential investment opportunities out there than anyone can handle. According to a new Bloomberg report: A Windfall of Opportunity or Something Else? Some real estate investors might wonder why all of this inventory is being shed. There are actually multiple reasons, including: All of this isn’t necessarily a bad thing, nor do they make these loans bad investments. For starters; if they are successful in selling, it could mean banks becoming more aggressive and pushing out more new loans. Those buying these NPLs could find this as one of the best sources of real estate investments with less competition and big discounts. It’s not just big national banks holding this paper or selling it either. There are hundreds, and thousands of others banks, credit unions and money managers around the U.S. with similar portfolios. So how can real estate investors find and buy these notes? Why should they? What do they need to watch out for? Getting Started in Mortgage Notes Get the edge by looking for better data on banks: Why Notes? However, there is a “but.” Make sure you know how to value them. Remember, NPLs are on sale for a reason. Don’t neglect due diligence. Recognize how value can change in the future on performance, demand and rate fluctuations.