September was a busy, busy month for us. We closed Fund IV to investors at the end of August and bought some notes last month. We had significant movement in Fund III's portfolio.....
Fund IV Update
We raised a total of $1,150,000 at the end of August. Whoo hoo! We are extremely thankful to the investors that put their faith and trust in us and decided to place capital with us. We've assembled a fantastic little portfolio of loans and expect it to do very well.
September started out very smoothly and we identified 5 very good, non performing notes within the first week. We ended up closing on 4 out of the 5 by the end of the month. The 5th one was pulled by the seller at the last minute, which is a big "no no" in our industry, and resulted in killing the seller's possibility of ever doing future business with us or the broker who set up the trade.
We ultimately found a replacement loan and are currently in due diligence on that one.
The four that we bought are all in late stage foreclosure or in very fast non-judicial foreclosure states:
Collateral Location Purchase Price Status
1. SFR in Houston, TX $120,000 Post judgment; waiting on sale date
2. SFR in Dale City, VA $240,000 About to file NOD
3. SFR in Annetta, TX $440,000 Expected sale date 12/4/19
4. SFR in Pleasantville, NJ $60,000 Sale date held 9/26/19; REO
Coastline Capital Fund III, 2019Q2
All of our 12 assets have progressed toward liquidation:
1 REO in escrow
1 REO undergoing rehab
1 REO with eviction in progress
5 notes post Judgment with upcoming sale dates
2 notes pre-Judgment
1 redefaulted note, 30+ days late
1 Reperforming Note with Borrower in CH 13 Bankuptcy
We expect to have 2-3 liquidations before the end of 2019. All but one or two should be liquidated by the end of summer, 2020.
The most noteworthy events happened with these three:
Highland, CA - we were finally able to get a hold of the occupant and arrange cash for keys. Once inside, we discovered a windfall. The county assessor showed the condo as a 2 bedroom, 1 bathroom, with 801 square feet. Instead, the condo was actually a 2 bedroom, 2 bath plus a loft with 1128 square feet! Instead of selling this for $130k as we expected to, we are anticipating selling it for $170k!
Homer Glen, IL - we knew that this note had issues with lien priority before we bought it but were not concerned because the title company was already fighting this in court. It took us three months to figure out that the title company was not really on our side and a few more months to find the right attorney to prepare a lawsuit for us. We filed a complaint against the title company for breach of contract (they waited 4 months before recording the mortgage). The title company responded by paying off the other mortgage, which will allow us to pursue foreclosure. We are currently in settlement talks over damages owed to us....
Rancho Murieta, CA - The borrower on this note didn't make any payments for years. She did this by bullying her servicers with excessive complaints and filing bankruptcies to stop sales. She postponed our 1st sale date but not the 2nd with multiple bankruptcies. The judge ruled in our favor and annulled the automatic stay, which validated our trustee sale. We are currently evicting the borrower
The Latest Posts from "Andy's Stories:"
NPN Story: Multiple Bankruptcy Tricks
"I’ve gotten used to the shenanigans that borrowers will resort to stay in their homes without paying a thing or at least the smallest amount possible. This borrower used an unusual method for the bankruptcy that stopped our original trustee sale....."
NPN Story: Deed It Back
"Not all of our notes end up in foreclosure. Sometimes (rarely), we get a borrower that’s actively trying to figure out a solution to their situation. If someone reaches out to us in a good faith attempt, we will meet them halfway and there’s almost always something that we can do that’s a “win-win” for their particular situation."
NPN Story: What Easy Looks Like
"Not every note we buy involves a huge amount of drama. Not every note involves a deadbeat borrower who will do everything in their power to stay in their house as long as possible without paying a dime. Not every borrower files for bankruptcy to stop a sale. Some borrowers, for one of a number of reasons, decides not to fight and let’s things just happen. This is what it looks like when it’s easy."