Many brokers in the note business often find spreadsheets or tapes of a portfolio of bank notes that are either non-performing and don’t have a lot of value or  the bank notes have very little equity.  These type of notes often have very little chance of getting sold, or if they do they are purchased in large quantities by institutions.  We have not had a lot of luck with these types of notes.  Conversely, if you can establish a relationship with a bank portfolio manager or bank manager then there are notes that can be very good investments.    A bank will often sell a note just to get it off their books which is good for the investor looking for a deal.  I must caution you to do your due diligence on the note and find the story.

The Texas Note Company recently purchased a bank note that we feel was an awesome deal.  Our relationship with one particular bank allowed us the opportunity to purchase a note at considerable discount.  We were able to cherry pick it from a group of notes that were being sold.  The bank note was one that we referred to as a “Scratch & Dent ” Note.   [Read more...]