Bulk foreclosure Opportunity

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Bulk foreclosure Opportunity
VANGUARD HOLDINGS, LLC.
Foreclosures have been recorded at an all time
high! Foreclosures were not even this
high during the Great Depression!
We are in the middle of a great historical time
in the US
Those who understand Cash Flow recognize the
timing of this opportunity!
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Bulk Foreclosure Opportunity
Banks have already tried to sell these foreclosed
homes several ways, but its important to
remember that banks are in the business of making
money, not moving real estate.
they listed the homes with local Realtors and
when that failed they tried to sell them for a
small discount at public auctions.
That should tell you that these properties are
roughed up and they will have varying levels of
needed repairs.
Some of these properties may be considered to be
in undesirable neighborhoods that some investors
dont want to invest in (due to lack of knowledge
regarding a profitable exit strategy). However,
one thing remains consistent PEOPLE DO LIVE HERE
AND THEY NEED A PLACE TO SLEEP! So why not help
them own a part of the American Dream.
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Banks sell these homes in bulk
As we stated earlier, banks are in it to make
money. Banks typically borrow money from other
banks at low interest rates and then loan it out
to us at slightly higher rates thereby making
money on the difference.
When banks allow homes to sit vacant, accruing
tax and insurance liabilities it makes their
books look bad making it difficult or impossible
for them to borrow more money from other banks to
stay in business. Its kind of like you or I
walking into a bank for a loan with a bad credit
score.
With the current foreclosure trend banks are
taking heavy losses and these packages are being
sold daily!
However, the banks loss has turned into huge
opportunities for savvy investors!
Eventually, banks must clear their books they do
this by selling in bulk to approved buyers.
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Purchasing a bulk bundle
Most bundles are so large that a it can cost from
one hundred thousand to tens of millions of
dollars. Therefore it is usually cost
prohibitive for the average investor to get
involved.
We have access to these distressed houses (i.e.
single family homes that are located in cities
all throughout the U.S.) at 10 - 30 of value.
We are able to obtain packages and break the
overall package into individual homes or small
batches for you to buy.
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Evaluating a bulk bundle
When a package is purchased Vanguard looks at
various internet appraisal sites to estimate
average real value comparisons for each property.
This analysis is not completely accurate because
These comps do not take into account the level of
disrepair each individual house might be in upon
purchase.
As with all comps, they are subjective and
subject to ones interpretation of active,
pending, and sold data.
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History of investment opportunities
In the last 40 years we have gone through 3
depressed markets 1972-1976, 1980-1984,
1990-1994
We have all read the Books by the so called gurus
of our day, or have even gone to one of their
seminars. But If you do your research, you will
find that they all made most of their money in
these depressed markets and are investing in our
current market today.
They know that the time to buy is now, when
everyone else is scared.
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Opportunity, lessons learned
Media Excitement Opportunists
Got in Too Late Opportunity Failures
Seminar/Educator Companies Marketers
Real Estate Investors Innovators
The Time is Now! We are in a depressed real
estate market and it is trending towards being
one of the deepest downturns we have encountered.
Real estate investors will create more wealth
than any other group in the next 5 years.
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Package Process Example
Typical Bulk Package
Performing Note 80
Wholesale or Flip 5
Non-performing Homes 15
Create Cash-flow
Tax Write-off IE Charity
Sell or Hold Note
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Frequently Asked Questions
Can I see these homes prior to purchasing them?
These properties are purchased as is, where is,
and with all faults, sight unseen. The risk one
takes when purchasing these properties is
reflected in the steep discount the investor
receives (i.e. LTVs lt 30).
Are all of these properties single family homes?
Are they all livable?
The majority of the package will be single family
homes. Occasionally, you may receive vacant
land, townhouses, duplexes, etc.
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Frequently Asked Questions
What about clear title?
These portfolios, when bought directly from
suppliers, are transferred using Quit Claim
deeds, which means that all prior liens remain in
tact. These properties may or may not come
with the title work cleaned depending on the
agreement. If agreed that Vanguard Holdings,
LLC will clean the title the home will not come
with title insurance.
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Frequently Asked Questions
How long does it take to flip an entire
portfolio?
The goal is to sell the note in 6-9 months. It
is possible with any investment that it could
take 2 years, depending on whether multiple
forfeitures occur within a particular house in
the portfolio. Even if the note purchasing
market disappears the investor still has a steady
cash flow.
Those who understand interest earn it Those who
don't, are doomed to pay it Albert Einstein
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Frequently Asked Questions
How long will this opportunity last?
Investors have been around for many years
purchasing these bulk homes. The supply has
greatly increased as of late, which has brought
about this opportunity to the non-institutional
investor. The opportunity will be available at
least as long as it takes for the national real
estate market to recover. As recovery happens,
the Real Estate Owned Property supply will
constrict, which will limit the opportunity.
The Time to be a part of the bulk foreclosure
market is NOW!
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Frequently Asked Questions
Are there any guarantees?
No. All investments carry some level of inherent
risk. However, we believe the potential returns
and the diversification that one receives by
buying homes across several U.S. markets
partially mitigates this risk.
This investment opportunity contains inherent
risk, a few of which include
You purchase the houses As is, where is, and with
all faults sight unseen. Some homes may be
uninhabitable, which will affect their fair
market value. This is an Illiquid investment
meaning, even though there is a reasonable
expectation of cash flow at some point in the
future, the investment cycle (from purchase to
disposition) may take 2 years before the
investor sees a potential full return of
investment.
Note Any profit suggestions from this
presentation are speculative and are not to be
taken as a statement of fact. These profit
projections are based upon the results of
historical portfolios. Historical performance is
not an indicator of future performance. A lot of
work goes into maintaining a portfolio, not
everyone is suited to purchase these homes.
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Property Management Process
Properties that are moved through private
financing created by you and me.
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Performing Note Strategy
We buy in bulk, dirt cheap, as is and sight
unseen
We sell AS IS to locals and offer
seller-financing at 100/mo less than the going
rent
We repeat the cycle with the funds from the sale
of the notes.
We hold the seller-financed notes for a period of
3-6 months and collect mortgage payments
Notes are then sold at around 50 of value to
note buying companies
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Frequently Asked Questions
5,000/property seems like a lot to spend for a
property management company. Is it really worth
it?
Absolutely! The cost appears high until you
consider the following facts
Vanguard has people stationed in, or traveling
to, each city where we buy houses.
There are a lot of hidden costs that an
investor may not consider while managing a
portfolio, IE traveling, advertising, and legal
costs (for forfeitures), city compliance fees
such as landscaping, trash outs, etc.
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Frequently Asked Questions
Can I manage my own portfolio?
Absolutely!! In fact we prefer it! Vanguard
Holdings, LLC will provide a packet of contacts,
forms and helpful hints to help facilitate your
success.
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Creating A Loan
There are five variables in time value of money
calculations term of the loan (T), interest rate
(I), present value of the loan (PV), future value
of the loan (FV), and the payment amount (PMT).
Knowing any four of the five variables above
allows one to solve for the fifth variable
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Effects of Sub-Prime Market
The sub-prime crisis is not necessarily
correlated with the market we deal with. People
in trouble in the sub-prime market are people who
took out loans they simply could never afford.
We deal with people who currently rent. The loan
payments they take on when buying our properties
are payments that they CAN AFFORD100 less than
the going rent (i.e. 250 - 600/mo). People
want to live in these homes because we make it
CHEAPER TO OWN THAN RENT.
That being said, the sub-prime problem is
affecting the sale of notes. Notes that once
sold for around 75 of their value, now sell for
50-60 of value. In addition, required FICO
scores on the occupants have increased slightly.
Keep in mind that if the secondary note market
disappeared all together, the investor ends up
holding a financial instrument creating a steady
cash flow.
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Frequently Asked Questions
What percentage of houses end up with buyers that
quit paying and require forfeiture of the home?
Based on historical data we have accumulated from
different sources, approximately 24 of the
notes became delinquent (one month late), and
1/3 of those delinquent notes require forfeiture
(three months late).
What are the tax consequences?
Please consult your Accountant for any tax advice.
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Frequently Asked Questions
Who buys the notes and why would they buy these
notes?
There are many accredited Note Buyers who
purchase notes for 50-60 LTV, which provides
them with a very nice yield on their investment.
The advantage to you is that it allows you to
receive profit today on a stream of income that
would normally take many years to collect on. Of
course, since we cannot guarantee that there will
be a back-end note buyer for every note that is
created, you should evaluate this investment
opportunity on the illiquidity and financial
merit of holding the note strategy alone.
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Investor Potential
Purchase portfolios of battered homes at 10-30
LTV!
Receive monthly positive cash flow from carrying
loans on the habitable properties in the
portfolio!
Receive a lump sum payment and cash out upon
creating performing notes and selling them at a
discount on the secondary market!
Leverage your time by paying a servicing company
(Vanguard) to perform every step of the process
for you! OR Manage your own portfolio!
Diversify your risk from the rest of your real
estate portfolio by avoiding the primary lending
market altogether (since you pay cash for these
homes and carry back the notes)!
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Vanguards Example Portfolio
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Portfolio Calculations
Any profit suggestions from this presentation are
speculative and are not to be taken as a
statement of fact. These profit projections are
based upon the results of historical portfolios.
Historical performance is not an indicator of
future performance. It is realistic to assume
that a few of these homes will be uninhabitable.
Therefore the performing note strategy will not
work on these homes. Vanguard handles these
properties by either a fire-sale to an investor
for a nominal amount of money, or get them
appraised and donate them to charity, giving the
investor a nice tax write-off.
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VANGUARD HOLDINGS, LLC.
Bulk foreclosure Opportunitywww.vanguardreo.com
info_at_vanguardreo.com801-389-3490