Anyone who has been in business has probably made a mistake that was a big lesson learned. It is so true that we learn more from our mistakes than our successes.
I have made my share and felt stupid and embarrassed as a result. Thankfully, none of them resulted in a big or catastrophic financial loss.
Tracy Z Rewey of Diversified Investments shares a story that makes me shutter . If you, as a potential note seller, have wondered why we do the due diligence we do in a note sale transaction, here is a perfect example:
“Once upon a time I bought a mortgage note without proof of property insurance on the collateral. It had been in place, then lapsed on the Friday closing date. Rather than pull funds or delay closing we finalized the deal, intending to renew the insurance on Monday. The house burned down over the weekend.”
Source: Tracy Z Rewey, 21 Tips For Real Estate Note Investing, www.DiversifiedInvestments.com.