Investing in Mexico, Mortgage Funds

Intercasa said:
"You are being a bit silly, do you go to your bank and requests info on their FDIC policy and how to recover if the bank goes under?"

Who are you calling "silly"? Condescending remarks don't contribute to your argument.....they just piss people off. Not a good business strategy.

There are people who, with or without a law or accounting degree, have been successfully investing their money for more years than you've been self-supporting. Those with a good sense of timing have done well. Those who buy high and sell low have a different tale to tell.

There are people who wish they had invested in the equivalent of the Bank of Mattress during the last debacle rather than in mortgage backed securities, as the Hound pointed out above.

In these times, if you can't make a joke about the current financial insecurity......you're in a different kind of trouble.

But..........you're in the business, so nobody blames you for putting on the salesman hat for your products.

And, you are appreciated for the many bits of free advice you have distributed on this and other web boards. Carry on.

IMO getting too much into speculation and minutia is silly, if you don't trust your investment person to do their job and they have to explain every potentiality in detail so you can second guess them, then perhaps they are not the right person for you.

We really have 2 issues here, with individual investors investing in individual mortgages they have much more control then buying into some blind fund manged by somebody where they have zero say in the underwriting. The two cannot be compared.

"Investment persons" make a buck whether the client wins or loses. Learned that one long ago......painfully. Since their crystal balls may be as clouded as mine........"trust" is relative.

I've invested in individual mortgages quite a few times in the process of selling property I've owned during my "house flipping" years. I knew the property well and vetted the buyers, so it turned out well for me. The only trouble with continuing that, is that there is no indication that property will not continue to lose value in this financial environment; thus, it's risky. I'm seeing a double dip recession on the horizon as quite likely.

Mortgage funds? I'm not going to go there. YMMV

Double dip recession? I don't think we ever recovered so no double dip, equity position, i.e.. low Loan to Value ratio is the key and will be your saving grace if the borrower stops paying, does every time and one cannot compare 80% LTV to a 40% LTV loan.

Intercasa wrote:Double dip recession? I don't think we ever recovered so no double dip, equity position, i.e.. low Loan to Value ratio is the key and will be your saving grace if the borrower stops paying, does every time and one cannot compare 80% LTV to a 40% LTV loan.

I agree with this, the recession never ended. At any rate, having recently been offered a 12% (guaranteed) return, on commercial property in Canada, ohh yes, it was a very special deal, only available to friends and family,(cough). We declined. It was for second mortgages, not too secure IMO.

I actually like the idea of mortgages, especially when I know the laws, and can have faith in the legal procedures. A low loan to value ratio under many circumstances would be very good, however under the current climate, I'm not as concerned about ROI, I'm just concerned about the return of my investment.

Now, Canada has not experienced the disastrous drop in values experienced elsewhere, however I do think that's probably right around the corner. In that case, a 40% LTV ratio could disappear pretty quick even without associated legal fees.

As to purchasing mortgage funds, no thanks. How many times has the original loan been sold off, repackaged, leveraged to infinity, and who holds title. Lots of trouble with that issue NOB. Lot and lots of original loan agreements have mysteriously disappeared. And despite the ruling by Judge Christopher Boyko, that the original loan agreement must be produced, in order to foreclose, some slimy operators continue to foreclose with no visible paperwork at all.

We can call it as a failure to recover from the first recession: no argument there....or we can imitate the pundits with the words "double dip". Doesn't really matter. Times are not good and the future of real estate is uncertain, along with the future of employment opportunity.

Yes, LTV is important, but that, too can be tricky. Someone I know of just inherited a condo in Pittsburgh, PA which was purchased for $50 thou, rose in value in the next few years to $100 thousand based on comp sales and when she inherited the property..........she had to sell if for the going rate in that complex: $21 thou, minus selling costs. That, too, along with the bulldozed blocks of foreclosed houses in that area..........is current reality. Where it will end is yet to be seen.

Yes, I'm a pessimist. Takes all kinds.