Every business will have experiences with difficult people. The note buiness may have more than its share. Let me share an approximation of a real call I experienced. Names and circumstances have been changed to protect the guilty:
The phone rings.
“California Note, good morning, this is Denny.”
“Yeah, you buy notes?”
( Oh! Oh! ).
“Yes, sir, that is what we do.”
“Yeah, I got a $100,000 note. How much you give me for it?”
“Well, I don’t know anything about your note, so I can’t answer your question. Who am I talking to?”
“John.”
“Hi, John. Why don’t you tell me a little about your note situation.”
“What do you want to know? I don’t have a lot of time.”
“Understand. So, what kind of property did you sell, how long did you own it, did you live in it, etc?”
“It’s a mobile home. You can get information from the County.”
“Of course I can. But you are the seller. I’d like to get 1st hand information from you and know as much as you do. You can understand that, right?”
“Not really. I can give you the address and you can do all the checking you want. But, I inherited the property from my Grandma. It was a rental for her for a long time. I fixed it up a little, lived in it for 5-6 years, and sold it to my cousinn for $100,000.
( John gives me the address, I Google Earth it and am looking at it on my computer.)
“John, looks like what I am looking at is about 6 months old. Tell me about the condition of the property.”
“I fixed it up some, but Andrew is a slob, he just doesn’t care.”
“I can see that. There is a broken down bike in the front yard, a car up on jacks with 2 tires missing. I see a lot of trash laying around the property. I don’t see any neighbors, the property looks pretty isolated..”
“Andrew is white trash.”
“What kind of work does Andrew do?”
“He doesn’t. He lives off Grandma’s inheritance and some state disability. He’s lazy, a junkie.”
“How much down payment did you get?”
“He’s family, I didn’t get a down payment. I am not charging him interest either.”
“OK. How many monthly payments have you received?”
“Two. He hasn’t paid me in over a year. I’m sick of it. Will you give me the $100,000 he owes me?”
“Well, John. Based upon what I am looking at and the information you are giving me, this would be a bad investment for us. We would not be interested in buying your note.”
“Click.”
“Hello? John? Hello, are you there?”
He’s gone.
An escrow officer once told me “Some people should not be allowed to carry a note.”
Amen!
