How Much To Offer For A Note?

Does anyone have a formula for what to offer for a note? Last year I bought a 2nd note from BankOne instead of doing a short sale. The loss mit. rep. said she could make me a better deal on it if I bought the note. So I bought the $24.5K 2nd for $3K and brought the 1st current and took it over Subject To. That worked!

Now, I have another homeowner who has a $83K 2nd with BankOne, but his 1st is paid off. Do you think I could anticipate as good a discount since it's the only lien? The ARV is about $150K and it needs over $100K of work. I'm trying to figure out what to offer. If anyone has any experience with BankOne, or any formulas to suggest I use, I'd appreciate it.

Thanks!

Comments(2)

  • commercialking1st November, 2004

    Theoretically a short sale and the purchase of a note at a discount are exactly the same financial calculation just different structures to the same number. Given $100k in rehab I wouldn't offer a lot here-- maybe $10k.

    Technically if the first is paid of and released then Bank One's second is now a first. But again, it doesn't make that much difference.

  • Smiling2nd November, 2004

    Wow, I agree with Commercial King with that amount of rehab work I would not
    offer much more than $10K.
    [addsig]

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