mortgage simple definition: Commercial Note Investing with Sal Buscemi

Commercial Note Investing with Sal Buscemi

Commercial Note Investing with Sal Buscemi. Investing in Real Estate 1st Lien Mortgage Notes vs. Fix and Flips Investing!

Commercial Note Investing with Sal Buscemi video duration 38 Minute(s) 5 Second(s), published by We Close Notes on 19 09 2018 - 23:41:51.

Episode 343 http://www.WeCloseNotes.com Scott: It's the first time to guest on The Note Closers Show but it goes back over about ten years
I'm honored to have

Welcome to Note Investing Made Easier where you can invest in real estate without buying property
As a mortgage note investor, I don't have to worry about Episode 343 http://www.WeCloseNotes.com Scott: It's the first time to guest on The Note Closers Show but it goes back over about ten years
I'm honored to have Gail the Note Gal talks about the pros and cons of real estate note investing vs
"fixing and flipping" real estate! There are advantages to fixing and flipping real .

Episode 343
http://www.WeCloseNotes.com

Scott: It’s the first time to guest on The Note Closers Show but it goes back over about ten years. I’m honored to have the one, the only, the man, the myth, the note-buying legend when it comes to commercial paper, raising big amounts for big deals. He’s the one, the only, Salvatore Buscemi joining us. How’s it going, Sal?

Sal: You and I have been talking about this for a while. We’re coming to the perfect storm as it relates to commercial and people haven’t seen that yet. The coming issues in commercial are going to make 2008 look like a speed bump. I know this is the anniversary of Lehman blowing up, but we’ll talk about that more. You can read about that on the papers. People want to get tactical and learn how to buy commercial notes.

Scott: I want you to share with our audience a little about your background, a little about your history, then we’ll dive into the nuts and bolts.

Sal: It might surprise you, Scott, to know that I didn’t learn this business by taking a pill one night, going to bed broke and waking up the next morning rich. I started out at Goldman Sachs in their investment banking division and their real estate principal investment arena. I learned the business there. After that, I worked for a smaller Chinese family office. For a few years, I was a hired gun. After that, I raised $30 million from a $2 billion hedge fund in New York in 2008 at the age of 29. We didn’t know at the time the kitchen sink for Bear Stearns when everything blew up. Moving forward, we found ourselves in Las Vegas because we bought a special servicer. If you know anything about hard money loans, in 2007, 2006, 2005, you basically had these glorified mortgage brokers pooling money together and lending it on assets. Most of it was land, lizard and snake territory in Gilbert.

We bought a special servicer for a dollar and recapitalized it with $15 million. The capital or lead, what we call limited partner LP, basically said, “If you want the money, you have to move to Las Vegas,” and there are also tax incentives for being here too as well. I’ve been out here for a while. I sold my condo in New York in 2013. If you know how to raise capital well, we’ve done some venture capital deals. We’ve done a lot of venture capital deals. We had an exit, an IPO. One of the companies went public in 2017 and invested into Airbnb. We’ve invested in some other companies that you might know of. We’re leveraging the economy the way it is. It’s strong. It’s almost as good as it can get. That’s the time when you want to start moving into things. Not only is that but my ex-boss at Goldman, Steven Mnuchin, is a Treasury Secretary.

I see things going on through New York circles where I’m from, born and raised, that a lot of people don’t see. We started making other bets in other industries, but it all comes down to how to raise capital and that’s the most important part. That’s about it, Scott. I have two dogs. I have a wife still, ten years. She hasn’t left yet. I have blogs and stuff like that, but what I am passionately talking about now is the time for people to get in and start understanding how to do this. These cycles only occur every ten to twelve years. Ten to twelve years from now I’ll probably still be doing the business, but will you be able to do it? The real wealth is going to be created right now because, in the commercial real estate, there’s no HOEPA, RESPA or anyone to protect the poor and stupid. It’s more or less the grownup man and woman at the table and you’ve got to know what you’re doing, but that also allows you to get kinky and creative deal structuring too as well.

Scott: Let’s talk about the commercial market. Where do you see it at right now? What is your crystal ball telling you?

Sal: There are a lot of people, I’ve seen it on Facebook and Twitter, novice investors, we affectionately call them doctors and dentists. What they did was in the smaller balance part of the market between three and 30 is where they’re most competitive. They were buying stuff that was a four-cap Savannah apartment complex. Borrowing at a four-cap. I don’t know how you make money off of that. A lot of people did not know how to value. They didn’t know what the hell they were doing. Now that interest rates have increased, that’s bad for those types of inexperienced operators. You’re going to see a lot of foreclosures and a lot of pain and that’s been what we’re doing.