Why track note sales? There have been at least 155 note sales recorded in city records this year, with original principals of more than $2.5 billion. That’s an enormous underground economy that does not end with the note sale, and offers multiple touchpoints of entry for an investor, broker, vendor or real estate professional. And while there are a small handful of extremely active note buyers such as Maverick Real Estate Partners, Toorak Capital Partners and Hirshmark Capital, such players represent only about a third of the note sales this year. The market is extremely fractured and the only way to have a handle on it is to track the sales.
How to prospect using note sale information:
Call the lender and ask what other loans are ready to sell. With a database of loans already sold a caller can leverage that intelligence, asking about particular borrowers or glean from the list of loans if there is an asset class the lender is shedding. The PincusCo database also includes the signatory for the loan assignor, so a caller has a connection to reach out to.
Call the note buyer and ask if it wants to sell, or buy something else. With a database of loans, the caller can gauge if the note buyer does only an occasional deal, or many. The database also reveals what kind of notes the note buyer targets, so a caller could pitch that kind of note or that kind of property.
Call the existing borrower and offer to make a deal. The existing borrower is likely in a financial squeeze, and it might involve more than this property. See other properties the borrower owns that it might be willing to sell or refinance to get some extra cash flow. The borrower might also have liens or violations, so a caller can offer to cover them as part of a workout.
PincusCo offers two recurring data products with note sales, the Basic plan for $50 per month, or the Distress Courts plan for $100 per month. We also offer custom data packages, with a price based accordingly. Please email [email protected] for more information.