Getting Started in Note Investing and Some Ways Your Business Could Go Sideways With Lauren Wells

July 14, 2021




GDNI 160 | Investing In Seconds


Investing in seconds is a waiting game unless the firsts are performing and there’s equity. It’s not for the faint of heart and it’s definitely not for the impatient. Chris Seveney doesn’t have much experience in seconds, but his guest for this episode does – and boy, does she have a story to tell. Lauren Wells is a note investor and a full-time mom and that keeps her pretty busy every day. In this conversation, she shares how she started buying notes right after the pandemic happened. She talks about her experience in buying seconds, dealing with borrowers, and investing from bankruptcies. She also shares insights on some ways a note business could go wrong – lessons that she learned from firsthand experience.

Listen to the podcast here:

Getting Started in Note Investing and Some Ways Your Business Could Go Sideways With Lauren Wells

I do have a special guest. I have somebody from the West Coast who got up bright and early, Lauren Wells from Rincon Partners. Lauren, how are you?

I’m good. I’m having a cup of coffee. It’s all that matters.

For those reading, I have to state that Lauren got up at 4:30 AM for this episode. A reason behind it is because Lauren also has a busy life like most of us as note investors. Lauren, why don’t you tell us a little bit about yourself and what keeps you busy during the day as well?

I’m a new note investor and a second-time mom. I feel like it’s not as difficult this time. In hindsight, you realize the babies don’t do much but they need to eat and have their diaper changed. I have a toddler who gives me a run for my money. That keeps me busy. You say like, “I’m busy.” I’m looking at you, you have a million things going on. Whenever we talk, I’m like, “I should be doing more. I need to fill my day even though I already feel like there are not enough hours in the day.” 4:30 AM works for me because I can almost guarantee that one of them will wake up. Most of the time, they are sleeping.

I’m busy and stuff but at least I can plan my day. I can structure how I want. You’ve got kids and I have kids as well. When they’re that age, you’re at their beck and call. You could be in the middle of something and then one of your children is hungry, they aren’t stopping until you feed them or whatever the case may be. Your day is probably more hectic and crazy than mine. It’s more challenging because of the simple fact that you can’t plan anything accordingly.

It’s different.

Let’s talk a little bit about note investing. When did you start studying, researching or learning about notes?

I started right after quarantine. Right after we all went into lockdown, I started doing all the reading from March, April, until about June or July 2020. It was a lot of reading. Next to my bedside table and my bed, I have probably twenty books that I read.

What is your favorite?

Invest in Debt and Paper Profits. That was the first time I was introduced to using the calculator and the equations behind it. It broke it down simply. That was a big takeaway for me from that book, someone who has zero background in real estate.

You had no experience in real estate. That’s interesting. By the way, have you gotten the book that I told you to order? Have you looked at it?

First and second notes are two completely different animals. Investing in both gives you different perspectives on things. Click To Tweet

I did buy it. We’re going on a vacation and I intend to take it with me. I’m not reading it on the plane because when you have two kids, it’s not going to happen. We will have grandparents helping on vacation so I have full intentions of reading it then. I didn’t realize it was going to be a school textbook. I’m glad that we talked about what chapters are most pertinent. While I would love to say I would have time to read all 700 pages, I probably would not get done anytime soon.

The challenge is it’s not 700 pages of easy reading. You have to understand it to get to the next section. It’s not like a book where I can read a page a minute or whatever it is. You’re going to read it and then get to the next page and go, “What was that again?” Flip back.

I’m going to have my highlighter out and probably highlighting everything. That’s how it usually goes. You’re like, “I’m going to highlight the important things,” and then you end up highlighting the whole page. Maybe that’s just me.

I don’t read much so I don’t highlight a lot. You’ve gotten off to a pretty fast start. How many notes do you have?

Fifteen. Fifteen makes the 1st and 2nd.

You dipped into both. What did you buy first? The firsts or the seconds?

The seconds.

They’re cheaper.

I felt like if it would be a good step into, “Do I want to do this more?” The firsts were more expensive so it’s more of a commitment.

On the seconds, a rough ballpark, what do you think your average purchase price was on your seconds?

Maybe $4,000.

It’s a low dollar value where people looking to get involved. A lot of people always say, “You need $100,000 or $50,000 to get started.” It’s nice to have that but if you want to pluck off your first note, you can start with a few thousand dollars but you got to make sure you have money in reserves and so forth. There are assets out there that you can buy for under $10,000. A case in point is you’ve got some of them. I want to talk about seconds because I don’t do too much in seconds. I always like to learn a little bit more about them. Were they ones that had equity in the first? Were the firsts paying? Was it a mix? Tell me a little bit more about some of the seconds.

GDNI 160 | Investing In Seconds

Investing In Seconds: If you want to pluck off your first note, you can start with a few thousand bucks. There are assets out there that you can buy for under $10,000.


I made the mistake of not looking for equity in the first two. Other than the first two I bought, the rest of them do have equity. If I’m going in the second position, they better have equity. Lesson learned. You don’t have much room to do anything if they don’t. Most of them have that. The firsts are all paying and the second isn’t. They’re all nonperforming. Another thing, I skipped performing completely and went straight for nonperforming. That’s my personality, like, “Let’s do this.”

You come off as being somebody who is aggressive but you’re highly motivated. The patient side of things is a little bit somewhere. My attorney laughs at me if I ever mentioned seconds because he’s like, “Don’t do it. Your patience level is zero. Seconds will drive you nuts because it’s a patience and waiting game. Unless the first is performing and then there’s equity then you can force a foreclosure. In some instances that might not be the case. Do you want to spend the cost if the first is also going through foreclosure?” I’m curious, now that you’ve done seconds and first, have you found one that you like more than the other? Do you like them both because they’re two completely different animals and give you different perspectives on things?

There are things I like about seconds but I will continue all day with firsts. I would never say no to a good deal. I would like to focus mostly on firsts moving forward. It’s the patience part of it and then you’re in the first position. I don’t know what else to say other than that. It seems like, “Why did I do seconds again?”

Have your seconds paid off or reinstated? Have you gotten any payments from any of them? How have those gone? Are you still waiting?

Before, I had five notes. It went from 5 to 15 because we purchased a lot of seconds and a few firsts all at the same time. Those five that I had before were seconds, nothing has happened with them. I started foreclosure on two of them because they do have equity in the second. I figured, “Let’s send a demand letter and get things going.”

What states are these in?

Florida, Georgia, South Carolina, Ohio and Nevada. It’s all over. I tend to stay away from New York and New Jersey not for any reason other than everyone seems to have a horror story. I have a fear of those and the long foreclosure process and timing and everything.

Is there one state you’ve preferred over others at all?

When we’re talking about this, I thought I liked Florida. I said that and then a week later, I had one that was going to auction. The auction was scheduled. The sale date was going to be Wednesday and Tuesday night. The borrower filed for Chapter 7 bankruptcy. A week earlier than that, I’m sending a demand letter to someone in Florida and we didn’t have the complete pay history. I thought I liked Florida but maybe not.

The one in Florida, we’re you in 1st or 2nd?

It’s my second bankruptcy. I have a Chapter 13 in Alabama.

I’ll be honest, to get the experience of bankruptcies early on is extremely beneficial. One of the first notes I bought was in bankruptcy because I wanted to learn the process. Me being somebody who likes to find anything on the internet, Pacer is my dream. Everything is there. I can learn everything about the borrower and find out how much they make and every bill they have. It’s interesting. As part of due diligence, there’s so much in there. You’ve got an Alabama Chapter 13 and a Florida Chapter 7. What stage does Chapter 13 in Alabama have? Have you gone through submitting your proof of claim?

You’re never just investing in notes. You’re also in the business of it. If it were simple, everyone would be doing it. Click To Tweet

The borrower has had her plan since 2018 and hasn’t made a single payment. When we took over the loan, we immediately filed a motion for relief. I’m learning everything as I go. My questions to the lawyers are always like, “What’s next? Do you need anything from me? Tell me what you need for me to move forward.” He’s been great. We filed that. Before the hearing, we came to an agreement that they would start making payments. We’re coming up. We’ll see how this goes. They would also have a plan to pay all of the arrears at the same time to catch up. They have essentially two payments they’ll be making. July 11, 2021 should be the first payment. I laugh because she hasn’t made any payments for two years. The relief was conditionally granted by the judge based on this. If she doesn’t make the payments, she has 21 days to come forward or we can start the foreclosure process.

One of the things that are important for investors is you haven’t gone through this process so you kept asking the attorney, “What do you need from me?” That’s important. The attorneys may think, “I’ve done this a million times.” They’re waiting on you and don’t even ask for something. For example, I was coaching my son’s basketball game, told him to go do something and I realized he hadn’t been through that so he didn’t know what to do. He didn’t want to ask either. I see that with investors a lot of times where they’re wanting to know what the process is but they’re afraid to ask. It’s important to ask.

I had an attorney email me something where we’re getting a demand letter out on an asset in Florida, They asked for something and I’m like, “I’ve never heard of this. What is this?” They’re like, “It goes with this.” I’m like, “I’ve never done that before. How do I get this to you?” They’re like, “Who’s your servicer? Send me their contact information and I’ll take care of it.” I’m like, “Thank you. Take care of it.” I paid him an extra $100.

You’re constantly learning. The key to move the ball rolling especially for newer people is constantly checking on the attorneys. What I usually do is, after a few weeks of something happening, “Is there anything you need from me?” At least remind them to check on the file to see if a hearing was scheduled or let them reply back, “Nothing now. As an update, here’s what the next scheduled hearing is,” or something along those lines. What do you think the outcome on that one is going to be? Are you thinking that you’re going to get a big fat check?

No. The total payment should be $1,300 a month.

How much does she have to come up with?

The one payment is $800. The other payment is $500.

I’ll be honest, Florida is not one of my favorite states for investing. I know a lot of people like it because of equity appreciation and properties and so forth. To foreclose in Florida, it’s a bear. You have to have every I dotted and T crossed. Tell the story because this is interesting. This one right up to the foreclosure sale.

We purchased the assignment of judgment. The sale date had already been scheduled. One of the reasons I thought I liked Florida is because of the appreciation. They were hit pretty hard back in 2007, 2008. I feel like they’re still appreciating. Even my second that I’m foreclosing on in Florida was one that didn’t have equity and now has equity because of the appreciation. The sale date was scheduled and I texted you in the morning and I was like, “She filed for bankruptcy last night.”

You guys are three hours ahead. I would feel like I’m catching up. I woke up and it was like, “The auction has been canceled. I don’t know why. I’ll let you know from the attorney.” I’ve been working with the previous seller on this. He’s been great in guiding me through. The attorney reaches out and says, “The borrower filed at 7:00 PM last night for a Chapter 7.” I’m on Google five seconds later, like, “What can I do?” I’m emailing the attorney like, “Tell me what the next steps are. Tell me what my options are. What does the timeframe look like?”

For me, at least, I want to know how much time I am dealing with before the next step can happen overall, what actions can I take and what can’t I do. Especially with bankruptcy as far as communication with the borrower, what’s allowed? He emailed me back and I went to Pacer and I was like, “What are the details behind this?” They did say that the filing was incomplete. She was missing a few documents or paperwork that was needed. She has until the 8th of July 2021 to correct the filing. If not then it can be dismissed. Essentially, the lawyer was like, “You can file the motion for relief now or you can wait until the 8th and see what happens.” It’s a matter of like, “Do you want to spend the money now?” and then the point might be moot because it might be dismissed anyway,”

I have a bankruptcy from March of 2020 that we’re still waiting to get the plan approved because they keep missing information. When a borrower doesn’t have an attorney or has a bad attorney, it’s worse because it keeps stalling the process.

GDNI 160 | Investing In Seconds

Investing In Seconds: When a borrower doesn’t have an attorney or has a bad attorney, it’s actually worse because it keeps stalling the process.


That’s the point. Isn’t that their play?

One thing to check is in Chapter 7, did they stipulate what they wanted to do with the property? Did they want to keep it? Did they want to surrender it? That’s important to note. What caught me off guard is filing a motion for relief on Chapter 7 because Chapter 7 is usually a quick process where the plan is approved and resolved in 90 or 120 days. At the end of it, they’ve wiped off their debt so they don’t owe you any money but you still have the house secured. At that point in time, they either have to do 1 or 2 things, sign a reaffirmation agreement, which says, “Even though my debt is wiped, I want to put it back on as debt.” If they don’t, there’s no reason. Now I do a motion for relief and be questioned by the attorney. If the plan got approved and the debt is wiped then you go right to foreclosure because they don’t owe money and you go after that property.

It’s because it was already scheduled for sale so it would be more about rescheduling the sale date versus having to go through the foreclosure process all over again. That might be it.

Hopefully, it gets dismissed. It’s like it never happened and then you redo a sale and what they’ll probably do is file again. I’ve had that happen. I’ve had a sale that went through and then got canceled after the sale because a borrower filed bankruptcy the morning of the sale.

I’m going to pretend I didn’t hear that.

Which part, the fact that they might file again or the fact that they hadn’t done the sale?

Both. When I first started reading all the books, note investing seems like a fairly simple, straightforward process. The concept of it seems like, “Why wouldn’t someone do this?” This is why a lot of people get caught up. That’s a topic for another time. The state-by-state differences, there are so many things that I’m learning. Right when I feel like I’ve got a little bit of a graph, I then realize I know nothing. When you read all the books, the concept of note investing seems like, “Duh.” You then get into the states, the minutiae of it, what’s allowed, what’s not allowed, what to look for and the things you don’t even take into account that you should be looking for. I didn’t know that I would need the pay history all the way back from the last five servicers. The default date, that’s what I can collect on. Every day I’m learning a new nugget of information that is crucial.

One of the challenges and why I temper people’s expectations because they’ll go take a course over the weekend from somebody. It may be a great course, I don’t know. I’m not going to judge opinions on it. I don’t believe anybody after spending a weekend on something to then be like, “I’m going to go run out and do it.” I’ve done it. You’ve done it now as well. The black and white are pretty easy. It’s a simple concept, note investing. This whole arena is pretty much all gray and there are many curveballs that can be thrown at you that it’s like, “Now what do I do?” That’s one of the reasons why building a solid network of people around you who you can go to besides your attorneys is important.

One of the things is I joke note investing to essentially being a chaperone on a third-grade field trip of students where you’re the only chaperone and you went to the zoo. It’s like, “Everyone stick with me.” They do it for five minutes and then all of sudden somebody sees a giraffe, elephant, crocodiles or whatever it may be and they splinter off and you have to herd them back in like herding cats. Note investing is the same way with your attorneys, servicers, preservation companies, bookkeeper, whoever it may be as part of your team.

Before, I was like, “I’m not just investing in notes but it’s also the processes and the business of it.” Getting all of my systems, vendors and everything set up, it’s not like, “I buy a note. I’m going to take it from nonperforming to performing and then I’m going to get a check in the mail every month.” If it was that simple, everyone would do it. I was thinking about this and I feel it’s a lot like parenting a toddler. You got to keep your cool. You can’t let your emotions as a parent get the best of you, which I feel like you need to do at note investing. You need to be super patient, which is not one of my strengths. I’m learning. You need to be super creative.

When I started, I had this idea of like, “This is going to be my exit strategy.” Everyone talks about that, “What’s going to be your exit strategy?” I’m like, “I have what I would like to do in an ideal world.” That’s never the case. Speaking with you and with other people, there are many different options and different things that you can do and ways to work with the borrower. If they’re not working with you, there are ways to go about it. That’s something I didn’t know and is another reason to have people to reach out to.

It’s challenging too in that sense because you get to a fork in the road where the decision has to be made. If you get aggressive and go after the borrower, sometimes they can delay the process longer than trying to work with them. I’m not saying that it happened in this Chapter 7 case because they haven’t paid in years. I’ve found early on that I had borrowers, I get 4 or 5 months behind and then I’d start the legal process. If they file bankruptcy and stuff, in some instances they want to work with one of the lesser amounts but then they’d go dark or whatever the case may be, I should have probably had a little more patience and waited to see what happened. It is interesting from that standpoint.

Note investing is like parenting a toddler. You need to keep your cool. You can’t let your emotions get the best of you. Click To Tweet

I don’t know if you’ve ever played blackjack or not. I view note investing a little bit like blackjack where if you’ve got 14 and the dealer is at 16, sometimes you got to hold but you want to play the odds. Think of what you would do in a situation. I got a house that has $100,000 in equity. I have a temporary loss of my job. If I’m the lender or if I was in that borrower situation, what would I do? I’d file foreclosure to protect my interest so I don’t have to sell my house and move and try and rent where rents are more expensive or buy a house, which I can’t because I’ll have crap credit. What do I do? You file bankruptcy. Now that I’ve gone through that more often, I see people do follow those odds more often than not from that perspective.

Especially in nowadays economic environment where house prices are through the roof everywhere, I’ve had a property that they wanted me to list for $25,000. I said, “List it at $40,000.” I got offers in the mid $50,000. This house has no drywall on it. It’s completely gutted. It’s in an okay area. It got some size but there are no properties in that area. All the fix and flippers are chomping at the bit for it. You bought three notes from me as well, 2 in Ohio and 1 in North Carolina. Let’s talk about them. The one in North Carolina, when we sold that to you, the borrower pulled her typical stunts where she was not performing and then she reinstated. Has that borrower continued to pay?

She has continued to pay. She’s made one payment since then. They’ve been on time. That one is cruising along. I didn’t have to do much there. Thank you for that. The two in Ohio, you helped me figure this out, they were HELOCs that move from 2nd to 1st because the 1st was paid off. I look at those as a good thing because they paid off the first. I don’t know what happened with the second.

A lot of times, the borrower may have been deceased or they thought they paid it off. A quick question for you, where are those boarded?

Those are boarded at Madison.

One thing that I would ask you to check, this is not a knock against Madison is to make sure that they have gone and recalculated the past interest. Some of the lines of credits I’ve had with all servicers, this just isn’t Madison. If this interest hasn’t been paid in three years, sometimes they haven’t brought it forward. FYI, the line of credit for servicers on defaulted loans is tricky. Every time the interest rate gets adjusted by the feds, they have to adjust it from there. If they don’t have the proper software to do it, a lot of times they have to do it manually so it can get a little time-consuming. Sometimes it does get missed. I’ve had it missed by multiple servicers. I’m not knocking Madison on this. I’ll let everybody know that if you have a line of credits, make sure that when you look at it, the past interest is being accumulated. A line of credit is like a credit card. It’s almost like a credit card statement versus what you’re traditionally used to seeing. It’s my Note and Bolt.

I was looking at that when I was trying to get reports for the attorney. That’s good to know. It’s another thing I would never have thought to check. I’m sending out a demand letter to those. The situation there is one of the Ohio loans is deceased and the co-borrower is not. However, they are both of those loans. The borrowers are much older and I don’t believe live at the property. They have a different mailing address. Thanks to you, I have all the systems to figure out where they are. It’s a matter of getting the demand letter sent to the right address.

Have you checked if the property is occupied?

They both are occupied.

They’ve got somebody living there. I wanted to roll into the last segment of this episode. I want to touch base on it a little more. Within note investing, what have you found to be simpler than you thought? What have you found to be more difficult than you thought? If there is a system or process that you found to be valuable, what would that be? Those are three. Let’s start with what have you thought when you got into this and be like, “This isn’t as difficult as I thought it was.”

I don’t think anything is simpler than I thought it would be. One thing that I realize is the note investing community is small. It’s easy to ask questions and get feedback. A lot of people are willing to help. I’ve talked to Matt Kelly. People are willing to lend knowledge, half the time. There’s also some training that people are trying to get you to buy. Those are the things I’ve realized. I don’t know if anything has been super simple because there’s so much to learn that nothing is like, “That’s easy,” because it’s easy. Usually, I feel like it’s because I’m missing something. I don’t think anything’s been necessarily super simple or easier than I thought.

In a sense, you hit the nail on the head a little bit where finding information or getting somebody to provide feedback in other industries because it might be a little more difficult or you might get people who will troll others. For example, some Facebook groups I’m in. If somebody asks a question, people insult the person because they’ve asked this question which was a valid good question to ask. People sometimes are a little bit meaner. I’ve been accused of being many different things even on Facebook. If there are 50 topics in one Facebook group on a subject and someone asks a question, didn’t do due diligence or search, I’m going to let them know, “Due diligence is important. If you would’ve done a quick search in this group, you would get your answer instead of asking the easy way out.”

GDNI 160 | Investing In Seconds

Investing In Seconds: If you get aggressive and go after the borrower just trying to work with them, they can actually delay the process even longer.


I’ve used the search function in Facebook groups a lot. I feel like you can find answers there. There are a lot of people who are willing to help. It’s more about being okay asking and knowing it’s okay that you don’t know.

What have you thought was a lot more difficult or painful and you’re like, “This should not be this difficult but it is.” Why do you think that is?

Working with servicers. My strategy with the first few loans was to keep them at the current servicer that they were at because it would be easier. I felt that transition. Oddly enough, one of them I did keep at the prior servicer and it wasn’t a super smooth transition. It was one of my first firsts and I felt like there was no communication. This was my first note with them. I’m like, “What information do you need from me?”

I’m super proactive in reaching out. I want to make sure that I’m filling out all the forms that need to be filled out and doing what is needed of me to board this loan efficiently and quickly. Those two words with servicing quickly and efficiently haven’t gone well. It’s been more difficult than I thought it would be. Part of that might be I didn’t know when I was bringing loans from somewhere else what was needed.

Having now detail-oriented systems, processes, I like those things. Now that I’ve gone through it a few times knowing, “This is what I need from the seller. This is what I need to get the servicer. This is the typical timeframe it’s going to take.” I have my checklist of things that have made that process a bit smoother because I can be more proactive now that I know what I need. When you don’t know, I felt like, “Are these loans even there? Are these being boarded? Do I own these loans still?” That was a little bit more difficult than I thought it would be. It’s mostly just that. Everything’s difficult when you’re new. That would be the thing that was the least smooth.

I had always heard nightmare stories about servicers coming into the business. One thing that people would always say is you got to manage your servicer. For me, I was a little more surprised about the quality of attorneys. I thought, “You’re an attorney. Everybody’s the same type of thing. Here’s your job. It was black and white, you do this, that and follow the process.” What I found is that is not the case. It’s taken me several years and I’m still tweaking my attorney list in states. It’s challenging, too because I had a good attorney and all of sudden, they fell off the face of the Earth. Now they’re not on my list anymore.

At first, I was using them and I’m like, “They’re good, efficient and fast.” It’s like, “What happened?” I found out one of them had a personal tragedy in their family. That makes sense. Similar with title companies as well and getting title reports, it’s not all the same. It’s like ordering a pizza, some places are good but sometimes you get a bad batch, some places are awful and you don’t want to use and you’re thinking, “It’s making pizza. It’s being made for hundreds of years. It shouldn’t be that difficult and it should taste good.” That’s how I view a lot of the vendors. I don’t know if you agree or disagree.

I skipped that because I got a lot of your feedback and information. You had already gone through all the headaches and nightmares and you’re like, “These are the attorneys that I recommend. These are the companies that I recommend you get your title reports from.” Maybe that would have been more of a headache. Reaching out to people who have been in the game for a while and asking what they do for X, Y and Z help mitigate the headaches there. I’ve had great luck with attorneys.

In Alabama, the attorney is awesome. He’s great. He’s Southern. He’s patient with me. I talked to him on the phone quite a few times. He’s from Brock and Scott, Wayne Keith. That was a recommendation from you. Something that we’ve talked about is when you’re looking for a recommendation, I want to know if you’ve worked with them. It’s easy for me to Google someone but I want to know like, “Have you worked with them? Have you had a good experience with them?” That’s different than you saying, “I found this attorney in Florida.”

That was going to be my Note and Bolt. In every episode, we do a Note and Bolt, which is a little tidbit. That can be yours because that’s a key. I’ll ask somebody, “Do you got a referral.” “Yes. I use this person.” I’m like, “Have you used them?” “No, but I heard it from this person and that person heard it from somebody.” At the end day, that person found them on Google. It’s like, “It’s not what I want.” A servicer sent me a list once. It’s got 8,000 attorney’s names on it from every different state. It’s like, “Does somebody want an attorney list? I can send you the names of 8,000 attorneys.”

It’s useless because have you used them? Anybody can put a list together. Who have you used? Who do you have experience with? Is it a recent experience? I found that an attorney from years ago or any consultant may not be the same as they are now. You stole my Note and Bolt. Thank you very much. I’ll have to come up with another one. As we wrap up, what are some of your final thoughts in note investing that you could give advice to others? We’re halfway through the year 2021. Where would you like to be at the turn of 2022?

The things I’ve learned and things I would say to people who are looking or thought about investing in notes, it’s not something like a get rich quick. Patience is the biggest thing. You’re not going to make $100,000 in 30 days, 60 days or a year maybe.

Patience is a big thing in note investing. It’s definitely not get-rich-quick. Click To Tweet

If you have $1 million, you can. If you’re starting with $50,000, you’re not going to double your money. If you want to double your money, go to a blackjack table or throw some money at Bitcoin and see what happens, close your eyes and play. If you’re starting with $50,000, you’re not going to double it in the first year in note investing.

When you’re new, read all the books and do all the research. This is not what you would think but the turning point for me was when I was listening to all the different speakers and you spoke at Diversified Mortgage Expo.

2021 was the Cash Flow Expo. Diversified was in 2020.

One of the two. I was probably listening to both. This whole time I had been looking into notes, everyone was talking about why you should do notes and why notes are the best thing ever to invest in. You were the first person who was like, “Here are all the ways this can go sideways. Here’s all the money you can lose on firsts. These are all the huge expenses that you don’t take into account.” I was like, “I’ve been looking for this, reasons not to do this. How am I going to lose a whole bunch of money?” Going into it with eyes wide open or as open as they can be of all the ways you can lose money and also having good expectations like what are your plans for the next year. If you’re in this to build a business, it’s different from like, “I’m going to give Chris money and invest in one of his funds.” That’s always an option people don’t consider. You don’t need to do the actual management of your own notes. It’s a lot.

I find that a lot of people are like, “I’ll buy a note. I want to be a note investor.” You then realize how much money you have to spend, how much time it takes to scale and say, “Screw this. Who can I invest with that I can go make probably more or the same and not have to do a thing?”

When I first started in seconds, I was working with someone and they said, “Let’s take this in six months increments and see if it’s something you want to do.” It’s not for everyone. I’ve got a lot of experience there. They were right. In six months, buy a note, go through the process and see if it’s something you want to do. You can make the same amount or more and do nothing. What are your goals? What are your expectations? If it’s to leave your job in 60 days, it’s probably not going to happen. It’s realistic expectations and finding people that you can reach out to.

$50,000 by the end of the year, is that your goal?

No. Once you have all the systems in place and your notes are boarded and you’re not continually buying, now we manage these all through the process. You’re keeping up with the attorneys and the services. I’m in a good place. The little one is still at home and the other one is at school. I feel like I’ve reached my capacity of what I’m able to do with the time I have. Once my baby is at school, daycare or whatever you want to call it, I then feel like I’ll be able to take on more.

This might sound crazy, maybe another 5 to 10 by the end of 2021. The other thing I found is you can get ADD quickly with note investing. You brought up partials and I’m like, “Why wouldn’t I do that? That seems like a lot less of a headache than nonperforming.” I’m still trying to poke holes in it. I know a few. That’s something I would like to explore as well moving into 2022. That’s my rough plan.

GDNI 160 | Investing In Seconds

Investing In Seconds: The note community is really small, but it’s really easy to ask questions and get feedback.


I joked at 50 and what you’re looking to do is instead of going out there and blow and go, “I’m getting a lot more assets.” You’re in a comfortable spot and you’re going to slowly grow but you’re also looking at other options and avenues to pursue during this timeframe to decide, “Maybe I’ll branch out and do a little bit of some performing and sell off as partials potentially as another strategy.” It’s important to realize that because with the nonperformers, sometimes if you’ve got a lot at once, it can be overwhelming. You could have 50 performing assets, 1 nonperforming and that nonperforming is going to take ten times more effort sometimes than all those other performing assets. It’s an interesting thought. It’s a wise decision to try and play at. This is an addictive business, by the way. People keep going and going and realize, “Now what do I do?” Sometimes they get themselves in trouble.

In some weeks, I have no idea how I’m going to get everything done. Other weeks, I’m waiting on a bunch. I feel like I could go maybe bid on more but then I’m like, “That’s probably not the smartest thing to do.” It’s fun. I’m enjoying it. I would not be working after my kids go to sleep if I didn’t.

Lauren, I want to thank you for coming to this episode of the show. If people want to reach out to you, what’s the best way for them to reach out?

Probably LinkedIn, Facebook or email me at Lauren@RinconPartnersLLC.com.

Lauren, thank you for joining us. For those reading, as always, go out and do some good deeds. Thank you.

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