Ep. 71: Become a Lien Lord with Scott Carson

“Everybody’s in the paper game, most are just on the wrong side of the payments,” states Scott Carson. He’s been in the mortgage, finance, and banking industry since 2001 and actively buying notes since 2005. Nicknamed, “The Note Guy,” Scott has closed on over half a billion of assets and teaches others how to become lien lords instead of landlords. On this episode he explains why he focuses on buying non-performing notes, where to buy, and key differences with commercial notes.

 

Key Market Insights

• Inspired by HGTV, Scott Carson started with flips, but they flopped
• Flips flopped because he over-renovated the properties
• He became a mortgage banker and practiced creative financing
• Focused on notes by cold calling asset managers and bankers, making 100 calls a day
• A 30-day trip across the country ended up being a 3-year trip
• Teaches others to become a lien lord, not a landlord
• Currently, 1 in 10 Americans are currently 30 days behind on their mortgage
• Note Strategy: 1st position liens, non-performing notes (6-12 months in default)
• Key is to get the borrower to start making payments
• Looks for occupied properties where there is pride of ownership, have realtors drive by the property
• After 12 months of performance, the note can then be sold again
• Get the servicing records, call logs, collateral file, call the county to confirm taxes, utilities, pull comps on the property
• Ensure you can get the right contact info for outreach within first 30 days
• Where to look when buying notes: Look for inventory,
• Does not like California, New York, New Jersey, Cook County or rural markets
• Recommends starting out with 1 or 2 states
• Commercial properties require more work to figure out the rents, leases, occupancy, etc.
• Every commercial note has the right to collect rents if borrower defaults

 

 

Bull’s Eye Tips:

Winning Your Market: To find distressed notes, go to LinkedIn and Search for “Special Asset Manager” or “Secondary Marketing Manager”

Tracking Market Changes: Constantly checking mortgage periodicals, websites and default rates

Daily Habit: Work Out Daily During Lunch

 

Resources:

 

Ep. 66: “How to Get Started with Note Investing with Bob Berland“

DSNews

 

HousingWire.com

 

Scotsman Guide

  

The Note Closers Show

Best Business Books:

Outwitting the Devil by Napoleon Hill and Sharon Lechter

 

Digital Resources

BatchGeo.com

 

Tweet This:

“Become a lien lord, not a landlord”

 

“When buying 1st position, non-performing notes, you need to actively reach out to the borrower to get them to start paying”

 

Places to Grab a Bite:

Seafood: Eddie V’s, Truluck’s

BBQ: Franklin BBQ, Rudy’s, Stubb’s BBQ

 

Connect with Scott:

Website: weclosenotes.com

Email: scott@weclosenotes.com

Text “Notes” to 72000 for Note Night in America Replay and Powerpoint

 

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