4 Reasons for Choosing Revolve Capital for Your Next Note Portfolio Purchase

At Revolve Capital, we are proud to have long-standing relationships with our clients. While ensuring transparency is key, we feel every aspect of the business is important. Each stage of the process, from product selection through post-close, we work with you every step of the way.

We separate ourselves from the competition by not only helping with the purchase but also helping our clients grow their portfolios. By creating a long-term relationship, we ensure success for you and us both.

How does Revolve Capital assist the client in growing their portfolio? Visit our new blog post now:

Consistency of Product

We are aware of how important regularly available inventory is. If you are in the process of talking to your investors and raising capital, you need to be purchasing your assets from a company you know will continue pumping out assets on a consistent basis.

We regularly update our website with general criteria of our available inventory (contact our Trade Desk for a more detailed list of assets.)

Safe Purchases

The assets we purchase and we sell to investors have been put through a heavy vetting process. We always vet, qualify and disqualify deals before we even purchase them. Therefore, we know the deals we eventually bring to market have been tried and true amongst many different vendors and eyes (other than our own). We utilize many third-party companies to vet our product.

Clean Collateral (Recycle Your Money)

Our collateral will always represent a clean product. We will always notify you when you are purchasing (for example) a single-family house, that is secured by real estate, you are in the first-lien position, and anything else that we say we are selling you that is included in the file is accurate. If you find the product is not as represented, you can always come back and recycle your money -or- get your money refunded back based on the reps and warranties given.

Post-Close Asset Management

The post-close management process is one of the most important aspects. Our clients see their money enter the real estate market and truly be worked to the hill so that it comes back to them. If you put out a dollar, then a dollar-quarter comes back to you**, and you can rinse and repeat and surely grow a business.

**These numbers are estimated based on past client purchases. Not guaranteed

We assist our clients in growing businesses, -and not just their business but also growing their investment profiles. If you are ready to purchase a note portfolio with Revolve Capital Group, contact us today and we will help with growing your investments.

Are you following us on social media? Keep in contact with us and see the latest news and updates by following us on your favorite social media outlets:

LinkedIn
Facebook
Twitter
Instagram

Everyone Focuses on Being a Landlord, When You Can Be a Lienlord

The definition of landlord is “a person who owns a building or an area of land and is paid by other people for use of it”.

When a person chooses to invest in the real estate market, a common income stream is to become a landlord. Generally, the real estate market is a stable and profitable income source. When the economy is on an incline, the profit margin can produce 10-15% ROI. You can usually expect to receive both passive income on a monthly basis with renters while acquiring equity in the home. On paper, this sounds like a win-win scenario.

However, as a landlord you have a lot of responsibility.

You are legally bound to providing a healthy living environment for your renters, you are required to have your property insured, you take the late-night phone calls that the water heater is broken, you communicate with the tenant as to why they were unable to pay utilities that month, etc.

What if we told you, you don’t have to be a landlord to receive the benefits of a landlord?

Let us explain.

The term “lienlord” refers to a person who owns a mortgage note and that debt is paid by the borrower (or homeowner). When a homeowner doesn’t make their payment for a duration of time, the mortgage gets sold from the bank to an investment company, such as Revolve Capital Group. We receive our assets directly from Top Tier 1 banks. When an investor (like yourself) purchases the note from us, the investor now becomes the “leinlord” (or the “bank”).

As the lienlord, you can benefit from owning the mortgages via the bank without having to be responsible for property repairs/maintenance, property taxes, legal-renter responsibilities, property taxes or renter issues that come into fruition with traditional real estate investment routes like buying rentals or buying fix-and-flips.

Property Repairs/Maintenance

Put yourself in the position of a homeowner. You take a mortgage out from Wells Fargo, for example, and you go purchase a house. Hypothetically, if your water heater breaks in the middle of the night would you call Wells Fargo to fix the water heater? Typically, no. The reason for that is the responsiblity of taking care of your home lies on you as the homeowner.

Let’s apply that same principle to being a lienlord vs a landlord. As a landlord, it is your responsibility to fix the water heater. As a lienlord, you are acting as the “Wells Fargo” and you don’t take those calls. Essentially, the lienlord is the bank -and- when you purchase the housing note, you become the bank. You would become the “Wells Fargo” and you (similar to the “landlord”) can continue receiving passive income coming in from the homeowner every month, and when you’re ready you can still sell the note to another note buyer. As a note owner, you also have the option to do other types of exit strategies or creative financing options.

Legal Responsibilities

With being a landlord comes endless levels of responsibility to accommodate renters. There is an implied warranty of habitability, which ensures the renters live in a safe, healthy and clean environment. Health and building codes must be followed, safety features need to be maintained regularly. The responsibilities trickle down even to proper handling of abandoned property. In the event the tenant must vacate the property, if they leave items in the rental they have to be properly stored, the tenants must be notified of where to pick up their belongings. Your main focus needs to be how to recoup and refill that vacant rental if you haven’t received rent for that property in a number of months and instead you are having to worry about the abandoned property from the previous tenant. Similar to property repairs/maintenance, when you’re the leinlord you are now the bank. Chase Bank, Wells Fargo, Bank of America, the bank that owns the mortgage to your home is not legally responsible for traditional landlord-tenant laws. When you “become the bank”, you collect the monthly payment while removing yourself from being legally obligated to maintaining a habitable environment, health/building codes, safety features, abandoned property, etc.

Property Taxes

You are also financially responsible for property taxes. If you have 10 or 15 rentals, you have to pay taxes on all those properties even if the renter stops paying. According to SmartAsset.com, “the national average property taxes are 1.211% of Assessed Home Value, averaging at $3,028”. If the condition of the rental property is average or below average, you are potentially using your profits to make repairs on the home, then to add yet another financial responsibility, such as property taxes, can reduce your profit margin even further.

Control of Terms and Interest Rates

As a leinlord, if you feel the terms of your agreement with the homeowner (the borrower) are unfavorable, you can control the terms and change them as you see fit.

If the homeowner was originally financed at (for example) 4.5%, and they stop paying on their home for 12 months, and the bank then sells the now non-performing note off to a company, like Revolve Capital Group. We will then sell that note to an investor (like yourself), and let’s say you turn that note into a re-performer. Because you own the note, and because you are now the leinlord (you are now “the bank”), you have the power to renegotiate the deal. You have the power to renegotiate any part of the contract you would like.

For example, you can change…
– The term
– The duration, how long the loan is going to be valid for
– The interest rate
– The monthly payments
– Is it going to be a potential balloon payment?
– Will you advertise the payments over a 15-year time frame, then after 15 years require the rest of the balance be paid at once?

So long as you are within the legal limits and not conducting unethical practices like predatory lending, you have the power to do so. If you plan on changing terms, make sure to research usury laws so you know the maximum amount of interest that can be levied.

There is not only 1 term that can change when you take ownership of a note, but you can also change anything you deem necessary because you are now the bank.

Emotional Investment

To remove another layer of responsibility, you can choose to completely remove yourself from the decision making process. If you’re used to this type of real estate investing, you understand what it’s like being in the position of the landlord receiving a call from the tenants that the wife got sick and the husband lost his job. Now you are in the position to decide if you will let them continue to not pay for the next 3 or 4 months rent. There is a huge emotional tie to being a landlord. However, working with a vendor/servicer, you have the benefit of choosing to remove yourself from personally having to deal with these issues when they arise.

Vendors / Servicer Utilization

We have a network of nationwide vendors who can be as involved or as uninvolved as you direct them. The vendor will go through a process we call KYC (know-your-customer), which is a “know your client” type of process where they will find out what you’re looking for in a vendor and what expectations you have for your assets. For example, if you own a non-performing note and the homeowner starts paying, the non-performing note would turn into a re-performing note. These vendors will handle that entire process with your instruction. Another example would be if the homeowner is asking for a reduction in their interest rate, let’s say there were paying 8% and now they’re wanting 4%. The vendor will come back to you as the leinlord, request your approval or denial, and continue according to your instruction. You are able to take a step back, allow the vendors/servicers to take over some or all of the management, and you can focus your energy, time, and resources on other aspects such as growing your investments. The secret to the buying notes and which investment company you choose to utilize is within their network of vendors.

The traditional real estate world generally pushes one of two exit strategies:

1. You purchase a run-down property, rehab that home, decorate it high end, and sell for a large markup.

2. You maneuver into a long-term cashflow by purchasing a decent property, find occupants, and you will become the landlord.

By taking the alternative approach to investing you can become the actual lienholder to that same property. Ultimately, you can make the decision if you don’t want to take the late-night “landlord” phone call, because you prefer to take calls during business hours. Being a leinlord allows you to take on investments that you can own for the next 30 years while the homeowner continually makes payments, but all the property condition concerns fall on the shoulders of the homeowner.

There are many downfalls to becoming a traditional landlord. Choosing to become a landlord comes with a lot of responsibility… this includes general property repairs/maintenance, legal responsibilities, property taxes and emotional investments. When you make the decision to become a lienlord you reap the benefits of being a landlord without the same negative drawbacks. Because you are now “the bank” you can control the terms and interest rates, and by utilizing our national list of vendors/servicers you can remove yourself from the majority of those responsibilities and you can focus on your monthly passive income.

Are you following us on social media? Keep in contact with us and see the latest news and updates by following us on your favorite social media outlets:

LinkedIn
Facebook
Twitter
Instagram

Business is Booming

Business is Booming at Revolve

One of the benefits that our clients have when choosing Revolve Capital is we purchase bank direct delinquent loans directly from Top Tier 1 banks and sell these same loans to our investors. By purchasing these delinquent loans from Revolve Capital, you have the opportunity to become the bank. This creates a passive income investment play with many more exit strategies available vs traditional real estate investing.

Revolve Capital Group is committed to providing a simplified purchasing experience to our investors. For more information, get signed up with us today by CLICKING HERE and learn how we can assist you in growing your investment portfolio.

The Secret to Buying Notes and Who You Choose to Invest With

One of the more common problems that we repeatedly see in the real estate industry, whether it be traditional real estate investing or investing in the distressed note industry, is that investors are hesitant to purchase outside of their own backyard. Sure, investing in your own city has the benefit of driving to the property, seeing the condition of the home, looking at the neighborhood or seeing the crime area. Even these seemingly “beneficial advantages” have drawbacks. Ultimately, you are still using your valuable time and resources to complete these tasks. There are ways that you can work smarter instead of working harder, and the many benefits extend farther than simply “living within driving proximity to your investment property”.

The secret to buying notes and which investment company you choose to utilize is within their network of vendors.

Over the last ten years of our experience, we have cut our teeth on utilizing many different companies on exercising the day-to-day needs of the business. National vendors that can run title, national vendors that have access to 65,000 real estate agents across all 50 states that within a 3 day period can get you back pictures (exteriors or interiors depending on the occupancy) within 3-5 days. Simply put, having an extended nationwide network of vendors allows you to scale your business, increase your profit margin and become a more passive investor. If you’re wondering how you have come to the right place.

Increase Opportunity

Using national vendor databases will increase the opportunity to invest outside of your own backyard. For example, if you’re in California then the discounts that the banks are selling distressed loans are much less than either Michigan or Ohio.

If you have the right ecosystem in place, which we give to you here at Revolve Capital Group, to help you turn a profit quicker…. investing outside of your own backyard almost feels normal. We’re located in Anaheim, CA and most of our product is in the mid-west and the East coast. That is not just by design, it’s because the discounts are far greater in that part of our country and our national vendors give us the ability to expand our investment portfolio to areas that provide steeper investment discounts.

Decrease Responsibility

National vendors assist with big tasks such as making the cold-calls, taking the property photos or even construction needs for home rehabilitation and renovation. Simultaneously, the same thing goes for smaller tasks such as documentation. At the end of the day, most investors do not want to house the documents in their personal files that their children, wives, or even a potential natural disaster can effect. Having those documents at a company that can take on the responsibility of storing those and inventory those. By allowing them to file your documents you will decrease personal responsibility… and ultimately you can free up your resources and focus in other areas, such as growing your investments.

Defer Accountability 

Allowing the vendor to be the direct contact for the homeowner will defer accountability. What is your plan regarding who will communicate with the homeowner? Who will make the cold calls? Who will adjust the interest rates? By using a vendor you can take the pressure off yourself and defer these tasks to a servicer.

These vendors, as a part of the on vetting process of bringing you aboard, will determine your needs by going through a KYC (know-your-customer) evaluation. To use an analogy, comparing a landlord to a renter is the same thing that could happen from a lien lord (or note holder) to an occupant/homeowner. If the loan goes from non-performing to re-performing then these vendors will handle that entire process at your instruction. At times, you may not want to give too low an interest rate. They may have been asking 8% interest rate and they’re asking for a 4% interest rate and the vendor will come back to you (the owner of that deal) and ask your approval and proceed per your requests. In this example, you may consider that 4% is far too low, even lower than today’s 30-year fixed interest rate. Therefore you might deny the interest reduction. The KYC evaluation allows you to get to know the vendor, and the vendor to get to know you and your wishes for your investments.

Allow Scalability

The price point to utilize a servicer is nominal in the swing of things, and using outside sources can allow scalability for your investments. Ultimately, it’s less a function of finance and more a function of time. We believe if you have a full-time job and you invested in real estate on the side, you absolutely need to be accessing vendors because that’s a scalable way to do business. It’s a scalable way for you to have a side investment vehicle. If you would prefer to do this full-time, then you could still quarterback the vendor to carry out the decisions that you’re making but they’ll come from your instruction. Otherwise, if you do it as an alternate business (or as a side business) the vendors will take your instruction, but they will be working nine-to-five every single day. The vendor could be working your files with or without your instruction essentially.

Facilitate Functionality

Vendors have experience, knowledge, and resources available to facilitate functionality. By becoming a more passive investor and taking a step back to allow the vendors to take care of the process start-to-finish you are essentially allowing the backend duties to function optimally. Your work-flow will be streamlined and with everything being directed by the vendor, you can focus your attention to other aspects of your business. However, if you would prefer to learn, roll up your sleeves, and do it all yourself then you also have the opportunity as well and the vendor will allow you to do that. Depending on how “fast you want to dive the boat” is how fast the captain will give you the wheel to take over.

We believe one of the single most important factors you need to take into consideration when choosing the right company for you to invest with lies within their network of vendors. By utilizing outside resources, you can benefit from increasing opportunity, decreasing personal responsibility, deferring accountability, allowing scalability, and facilitating functionality.

 

Our vendor network is something that we give our clients that is a tried and true test over the last 10 years of companies that carry out the infrastructure of this business. Unfortunately, there are not too many firms, companies or note sellers that will instruct you on who to use as a vendor to operate this business. They expect you to already have that handled. The mindset of “you’re already coming to us for product so you should already have your ducks in a row”. There is not an “educational book” out there that teaches everybody A-Z. This is why we tried to separate ourselves by offering this network of vendors/servicers for free.

Now you can play a part in the exact systems we have put in place to create Revolve Capital Group. So you can feel comfortable expanding your investments using our established national vendor network.