Click HERE for FREE resources and training!

BFF: What “Bank Failure Fridays” Mean to Note Buyers

BFF: What “Bank Failure Fridays” Mean to Note Buyers

September 11, 2009 by notebuyingprofits.com  
Filed under Buying from Banks, Finding, Note Buying 101

Bank Failures and Note Buying 101

A bank failure is not the same each time around. And they all represent different opportunities for a well-tuned note buyer.

Here are the four key things to look for in bank failure announcements:

1)   Did the failed bank get taken over? There are 3 types of bank failures:

  • Payoffs (PO’s) wherein the FDIC actually creates a new bank to take over the bank’s deposits
  • Insured Deposit Transfers (IDT’s) where one bank assumes the failed bank’s liabilities (checking and savings accounts), but not its loans
  • Purchase-and-Assumption agreements (PA’s, in FDIC parlance), in which one bank buys the assets (loans) and liabilities (deposits) of another bank

    • Note: The 3rd category above is by far the most common. Through September 1, 2009, there have been 77 Purchase Assumptions; 1 Insured Deposit Transfer, and 6 Payoffs, for a total of 84 bank failures in 2009.

    2)  Who took over the failed bank? If a bank fails and another bank takes over its assets (which includes a bank’s loans), then pursue the acquiring bank to find out how they’ll be selling the failed bank’s loans. It’s not a matter of IF, but WHEN.

    3)  Finally, how exactly did they take over the failed bank? Was there a Loss Share agreement in place or not? A Loss Share, simply enough, indicates that the FDIC and the acquiring bank are sharing the losses on the loan portfolio. These are probably the best places to start in terms of pursuing note sales, since these banks will often be looking to sell off the acquired bank’s loans.

    4)  What’s the contact information of the acquiring bank? This seems pretty straightforward, but it’s worth checking the FDIC website rather than just Googling the acquiring bank. Here’s why: the FDIC often appoints a point of contact within itself for REO vs Note sales. Go to the FDIC website, then select “Failed Banks”, then “Failed Financial Institution Contact List”, then type in the date range you’re looking for and then search.

    Write a comment below and let me know what you think,

    Dean

    Share and Enjoy:
    • Technorati
    • Digg
    • del.icio.us
    • Facebook
    • Live
    • StumbleUpon
    • Google Bookmarks
    • Reddit
    • Bumpzee
    • Furl
    • Mixx
    • NewsVine
    • YahooMyWeb
    • Propeller
    • Blogosphere News
    • Sphinn
    • MyShare
    • blogmarks

    Tags: , , ,

    Comments

    4 Responses to “BFF: What “Bank Failure Fridays” Mean to Note Buyers”

    1. Winnie on September 11th, 2009 1:20 pm

      Thank you so much for the info!

      Winnie

    2. Owen McGab Enaohwo on September 11th, 2009 11:09 pm

      In just this post alone you have given away so many Gems for free! This is being how to be a resource before being a vendor in its true sense.

      Nice one Dean!

    3. STEVEN MANCILLA on September 14th, 2009 11:26 pm

      WOW!!! GAME, SET, MATCH!!! THIS INFO IS SIMPLY INVALUABLE!!! ONE WOULD NEED TO HAVE WORKED WITHIN THE FDIC TO GET A HANDLE OF THIS INSIGHT.

      THANK YOU!!!

    4. David on December 11th, 2009 2:18 am

      Now that we have contacted the correct holder of the NPA’s how do u find funding and end buyers for the the NPA’s?

    We want to hear what you think. Please leave a comment!





    Security Code:

    • Testimonials

      "YOU CAN'T FIND THIS INFO ANYWHERE ELSE." Dean's course on “Finding Notes” was instrumental to my success in my sub-group formation and successful note pool purchases. I have to date purchased (with the help of my sub-group members and NBP) over $2.5m in uncollected UPB (Unpaid Principal Balance) on 1st and 2nd position loans since Jan 8 2009! Just learning the language of these bankers/ brokers from Note Buying Profits was my first step in the door... I am a firm believer in sticking with something that works, and Note Buying Profits does work. Whether you are a beginner to note buying or a seasoned RE investor with a track record, your time is well spent reviewing the material that is laid out for you in these conference calls and courses. Having this material at your fingertips will jump you far ahead in the learning curve past other note investors that are out there and keep you current in this ever changing environment on Note Buying. You can't find this info anywhere else.

      Mike Ruscica (New Jersey)

      "THE COURSE IS RICH IN KNOWLEDGE, STRATEGIES, AND PRECISE DIRECTION." Because of the fundamental and solid teaching in your course, I find myself having more than enough non-performing notes to either bid on or broker out to larger investors. I’ve done that with just your basic but valuable info on contacting, knowing what to say and following up. I feel I have come full circle and have put in place a solid business that is more than ripe to take off. Yet that’s not it. Is it the fact that because of your teaching, direction and strategies I am now linked up and working with some very well capitalized buyers to broker the many notes, pools of notes that now come through my email? No, that’s not it either. So, if I must pick one thing then it would have to be the this: It’s the underlying message, very well communicated, to really take serious, immediate and efficient action. The gift was that I completely believed it can be done. The course is rich in knowledge, strategies and precise direction but your ability to create a clear vision about how, if one commits oneself, anything is possible, is where the true value lies.

      William Seminario (Florida)

      • Popular Searches


    • Recent Posts