Texas Real Estate Note Deal Breakdown: 18% LTV Non-Performing First Lien Case Study

So, you know, we get this list in.

I have one of my hedge fund traders I've traded with for years.

He gets stuff on a regular basis.

He sent out this list, and it had seven notes in it, right? Seven notes across the country in different states.

It had one in the Lone Star State.

And when I Googled the address, here's a picture of the property that popped up.

A nice brick home, you know, two-car garage.

It looks really nice, manicured.

I mean, the photos just are awesome on this property.

Look at it.

I mean, it's just absolutely gorgeous.

Now, the thing that stands out is, oh, wait a second, it's vacant, right? Are these the original pictures of the house? From it, and I'm looking at the tape, it says 30-year first lien cash-out refi.

Okay, so they had this house paid off.

Zillow gives me a value about 500,000, Zestimate.

You do see a washer/dryer in the property.

I was like, okay, somebody lived there at some point, but it's vacant right now.

And guess what? When I look at it, I see that the property has just been listed two days ago on the HAR.

That's a Houston, you know, [laughs] uh, you know, uh, o- uh, Houston, uh, Board of Realtors, basically.

You know what I mean? And, uh, I'm like, "Oh, that's interesting.

This is something that's interesting." These are current photos.

It's vacant property.

Maybe it was a DSCR loan or something like that, but it says, still says first lien cash-out refi.

And the balance on it, the loan was originally taken out for just $90,000.

And I'm like, whoa, so they're at under 20%, like 18% LTV of it, but what's going on with the deal? And I look at these pictures and I look at the tape.

It's at 6.625, which is not too low.

So, you know, we get this list in.

I have one of my hedge fund traders I've traded with for years.

He gets stuff on a regular basis.

He sent out this list, and it had seven notes in it, right? Seven notes across the country in different states.

It had one in the Lone Star State.

And when I Googled the address, here's a picture of the property that popped up.

A nice brick home, you know, two-car garage.

It looks really nice, manicured.

I mean, the photos just are awesome on this property.

Look at it.

I mean, it's just absolutely gorgeous.

Now, the thing that stands out is, oh, wait a second, it's vacant, right? Are these the original pictures of the house? From it, and I'm looking at the tape, it says 30-year first lien cash-out refi.

Okay, so they had this house paid off.

Zillow gives me a value about 500,000, Zestimate.

You do see a washer/dryer in the property.

I was like, okay, somebody lived there at some point, but it's vacant right now.

And guess what? When I look at it, I see that the property has just been listed two days ago on the HAR.

That's a Houston, you know, [laughs] uh, you know, uh, o- uh, Houston, uh, Board of Realtors, basically.

You know what I mean? And, uh, I'm like, "Oh, that's interesting.

This is something that's interesting." These are current photos.

It's vacant property.

Maybe it was a DSCR loan or something like that, but it says, still says first lien cash-out refi.

And the balance on it, the loan was originally taken out for just $90,000.

And I'm like, whoa, so they're at under 20%, like 18% LTV of it, but what's going on with the deal? And I look at these pictures and I look at the tape.

It's at 6.625, which is not too low.