NoteSchool - July 2022

NoteSchool - July 2022

NoteSchool News JULY 2022

A Hurricane Is Coming — And We’re the Hardware Store! HOW TO PROFIT FROM A STORMY ECONOMY

Real estate is a wild ride of a business. The market is always changing, so I don’t really make annual plans. Instead, every quarter I take a look at what’s happening and adjust accordingly. Right now, we’re going into Q3 and I’m playing weather forecaster again. What will the market be doing in one month? Two months? Three? You don’t have to be a genius to see that there’s a big hurricane on the horizon. The hurricane is the market. Interest rates are going up, and up, and up. Mortgage lenders are having massive layoffs and leaving big gaps behind. Basically it’s a big, scary change — but it’s also a business opportunity. In addition, there are 2 million non-performing residential mortgages coming down the pike. Think about it. If the weather forecaster says a hurricane is coming and you’re watching it getting closer and closer, what business do you want to be in? You want to be a hardware store, right? You want to be the one selling plywood, nails, and generators. If you’re that person, you’ll probably be decently busy all the time. But when the locals hear a hurricane is coming, then you’ll really have people running into your store in a panic to tear stuff off your shelves.

headed straight for us. While everyone else is panicking, we’re getting ready to profit!

members to dial in their Q3 plans because there is so much volatility in the market — and typically, turbulent times are when notes do the best. As I told you last month, I saw this myself when I entered the market in the wild times of the 1980s, when interest rates were literally 20%. This isn’t my first rodeo with a hurricane! After 42 years of experience, I’m even better at innovation and problem-solving than I was back then. One last thing: Summer Summit is a NoteSchool members-only event, and since it’s right around the corner, you’ll probably miss out on it unless you register at lightning speed. But it’s not too late to get your own little hardware store up and running. You don’t have to be Home Depot to experience inordinate success. There are opportunities for you to profit in this hurricane season. Here’s my advice: When you’re making your investment plans for Q3 and picking what to change and what to keep based on the market, don’t leave notes and NoteSchool out of the equation.

By now, you might be wondering, “Eddie, how the heck did you get to be the hardware store?” The answer is creative financing. The note business is built to fill the gaps the regular mortgage industry leaves behind. And because that industry is projected to shrink by a whopping $1.7 trillion this year, it’s leaving a dang big gap to fill. Our business has a lot of potential for growth right now because it’s not being punched in the head like conventional lending. The note industry is solving problems in a problematic market, so all of a sudden, our wares have become extra valuable — just like hardware store merchandise in a hurricane. If you know how to buy notes and what to do with them, you can make a big profit off of this economic storm. This month, my team and I are meeting with our NoteSchool members in Grapevine, Texas, for our Summer Summit (July 14–15) to talk about how to do just that. We’ll tell them exactly how to stock the hardware store and make the big bucks at our private mastermind and other events.

If you do, you’ll regret it when the storm hits.

My NoteSchool members and I are the ones with the hardware store — and a hurricane is

I haven’t been this fired up about a Summer Summit in years! This is a critical time for our

–Eddie Speed

NOTESCHOOL.COM

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Jamie Dimon, CEO of JPMorgan Chase, recently told investors to prepare for turbulence in the weeks ahead, warning that financial circumstances are creating a potential “economic hurricane.” But the economy is not negative IF you know how to pull the right levers. To do that, we’ll keep you informed. TURNS OUT INFLATION ISN’T TEMPORARY AFTER ALL • Last year, Janet Yellen (U.S. Secretary of the Treasury) reassured the country that there was no reason to be concerned about inflation because it was only “transitory” and would quickly go away. But on June 2, she admitted she was wrong and had not previously understood the situation. NEWS IN A Negative News Can If You Know Wh

With our phones always on standby, we’re more easily distracted than ever. Then there are also interruptions by coworkers or family members, emails or instant messages that divert our attention, OVERCOMING INATTENTION Strategies to Fight Distraction

household chores that will “only take a minute,” coffee breaks, and daydreams. Constant distraction hurts us more than we realize, creating a feedback loop of inattention. It’s time we understand what all this multitasking is doing to our minds and figure out how to break the cycle. No matter how good you think you are at it, multitasking doesn’t exist. What we’re really doing is called task-switching. Our brains can concentrate on only one thing at

a time, and the quicker we go back and forth between tasks, the less we pay attention, and the more likely we are to make mistakes. Even worse, research says it takes us a whopping 23 minutes to regain our concentration after being interrupted. But what can you do? If you’ve ever been on a diet, you know that willpower has its limits. Simply promising you won’t check your email or phone rarely results in long-term success. But if technology is a big part of the problem, it can also be part of the solution. Try putting your email or phone notifications on silent. Or, consider a website blocker to keep you off distracting websites and an app that will lock distracting features on your phone. Low-tech solutions like a “do not disturb” sign and putting your phone in another room can also help. And mental tricks can still have their place. You probably tend to become productive when you’ve got a deadline crunch, and there’s a reason for that. Tasks have a way of stretching out unnecessarily when we don’t have to follow any restrictions. So, make some! Determine how much time you need to complete a task, and then don’t allow yourself anymore. Ask a colleague for help staying accountable. You’ll be amazed at how much you get done. Though we each have to fight our own battles, this isn’t entirely our fault. Popular apps make billions of dollars by sucking our attention away from everything else, so we’re automatically at a disadvantage. And there may be even more than meets the eye. If you have difficulty concentrating, stress could be the underlying culprit. Get that under control, and distractions might suddenly lose some of their allure.

• Mortgage rates are the highest since 2009 (now at 5.27%), and are expected to continue rising as the Fed raises rates.

• Median home price in the U.S. hit $391,200, which is up 14% (roughly $50K) from one year ago.

• Goldman Sachs now predicts home prices will rise 10% this year, Bank of America predicts 15%, Zillow predicts a 14.9% increase, CoreLogic predicts 5%, and Mortgage Bankers Association predicts 4.8%. • As home prices have risen, almost 45% of homeowners are now equity rich, meaning they have more than 50% equity. And yet, homeowners who are underwater have increased 3%. Re-fis have dried up and lenders are laying people off. • Mortgage payment-to-income ratio shows sharpest rise in 20 years. It now stands at 31% of a buyer’s gross income, which is on par with 2008 before the crash. • Overall inflation is still above 8%. Fuel prices are up almost 45% from a year ago (currently as high as $8 a gallon in Los Angeles), food prices are up around 10% — all combining to put pressure on “affordability” and making it harder for people to pay their rent or mortgage.

• To take more money out of people’s pockets, Obamacare premiums are set to increase around 50% this fall.

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HOME INVENTORY IS STILL TIGHT AND STILL KEEPING PRICES HIGH • Stalled new home construction projects are up nearly 50%. The stoppages are due to labor and material shortages. • As interest rates and supply chain woes continue to batter the home building industry, sales of new homes dropped 16.6% in April to the lowest level in two years. Analysts surveyed by Refinitiv had only anticipated a drop of 1.7%. • There are 8,000 fewer houses for sale today than 40 years ago in 1982, even though there are 100 million more people living in the U.S. HUGE WAVE OF NONPERFORMING LOANS MAKING THEIR WAY TO THE MARKET • Black Knight Mortgage Monitor reports 1,682,000 mortgages are at least 30 days past due (sometimes referred to as “sludge”). Most of these mortgages will not get caught up, which opens a wide door for nonperforming loans. • Consumer Financial Protection Bureau (CFPB) reports 330,000 borrowers left forbearance (often due to expiring) but were still delinquent. Adding that to the previous numbers puts the total at around 2,000,000 delinquent loans. This might soon bring more homes onto the market, and more nonperforming loans for note investors. NUTSHELL n Become Positive hat to Look For

We’re in the business of constant improvement here at NoteSchool — and that includes refreshing our website to make it more valuable for you! This spring, we gave NoteSchool.com a facelift. Using our site is easier than ever. If you check it out, you’ll notice a few new perks right off the bat. CHECK OUT OUR UPDATED WEBSITE! NoteSchool.com Just Got Better

The new and improved NoteSchool.com has …

• A blog packed with free information about the note business.

• An FAQ page where Eddie answers your burning questions on video about how notes work, how to buy notes, and the best time to buy them. • An Education page that makes learning about all of our services — including our live classes, mentoring options, books, and courses on the note business — super easy.

• Fannie Mae has announced the sale of 3,400 nonperforming loans, which is just a “drop in the bucket.”

• An About page where you can learn more about Eddie and meet the rest of our team of financial experts.

• The number of delinquent auto loans, credit cards, and personal loans has also risen from one year ago.

The new website also has fancy new colors and a clean, fresh look. It’s really easy to check our class schedule, sign up for a Rich Rewards In Notes three-day live training, or find our phone number if you want to give us a call. If you’ve been on the fence about working with us because you just want to know a little bit more about notes and what we do before you commit, pay NoteSchool.com a visit. You’ll find everything you want to know, and if not, you can always call us with a question. We’re all teachers here, so we’re happy to help you learn.

CREDIT AVAILABILITY GETS TIGHTER AND TIGHTER • Many home buyers who signed contracts to build custom homes a year ago and waited patiently through the labor and material shortages are discovering that they are now unable to qualify for the mortgage to buy that home, due to higher mortgage rates and increased property taxes. • Mortgage credit availability dips for second consecutive month. 2021 had $4.5 trillion, but 2023 is expected to drop to $2 trillion, which is a huge opportunity for creative financing to fill the gap.

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1 A Storm Is Coming — Let’s Profit! 2 How Distractions Are Hurting Us 2 News in a Nutshell 3 Mouthwatering Southern BBQ 3 Meet the New NoteSchool.com 4 Don’t Rely on Profit to Measure Success Inside this issue

Business Is a Never-Ending Game How Do You Play This Infinite Game?

Chapter 5: Building a Culture of Trust A healthy work culture is based on trust. If your workers sense a lack of trust, that affects efficiency, since no one will feel comfortable voicing their concerns or mistakes. Ford Motor Company is a perfect example. Before 2006, the now-former CEO would reprimand and penalize workers who brought him bad information. This caused an unhealthy work

“The Infinite Game” by Simon Sinek is among the greatest motivational books you can get your hands on. He gives readers an inside scoop on the importance of adopting an “infinite mindset” while “playing the game” of business. Let’s look at some of the chapters that can help you and your business. Chapter 1: Business Isn’t a Finite Game The first chapter discusses why running a business isn’t a finite game. It focuses on how profit and income aren’t the only ways to measure success. Profit means nothing if you’re unable to survive current and future difficulties. This is why business is an infinite game — you don’t want to create something to “win” (finite); you want to build a foundation that will remain for future generations (infinite). Chapter 2: Essential Practices Sinek explains the strategies you need to play the infinite game. These skills include developing a “just cause,” creating trusting teams, studying your rivals, preparing for flexibility, and showing courage to lead. He follows up with examples of companies that embody all five of these principles: Victorinox, the creator of the Swiss Army knife, Bill Gates and Microsoft, and the GPS company Garmin.

environment and led to lower productivity. Sinek offers tips on how to create a culture where your employees are comfortable and confident.

“The Infinite Game” teaches you that business is an endless game where you have to overcome many challenges. Successful businesses play the infinite game, constantly improving the business to become better. Sinek provides tips, solutions, and examples of how your business can thrive while playing the game. To get your hands on “The Infinite Game,” visit your local bookstore or online retailer.

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