Buying discounted debt
contracts and the revolutionary
techniques to build a
great portfolio
with them
“Financial institutions are legal fictions, which are inanimate objects.”
Revolutionary money making techniques
In the debt consolidation industry, building wealth requires knowledge. You need to know the banking, private lending, and collectors’ arenas, as well as the players’ functions and objectives. In order to build wealth with debt consolidation, the borrower must participate in the conveyance process.
Private lenders who complete conveyance and allow the borrower to participate, is how they are both able to benefit and profit.
Understanding this point is crucial to building wealth in this industry.
Borrowers and private lenders:
What is the biggest benefit when participating in the conveyance process together?
Answer:
It allows two people doing a deal to have an advantage over the original owner of the debt.
The process maximizes profits for both the private lender and the borrower. It creates a win-win situation while securing a power position over the institution who owned the debt.
For the borrower, it is a huge benefit to not deal with a financial institution. They are legal fictions or inanimate objects. Dealing with them can be frustrating on many levels. This makes working with private lenders all the more attractive to borrowers.
What is a legal fiction or inanimate object? When we use those terms, we refer to the fact it can not make a decision on its own. It cannot breathe, think or feel. Employees simply follow procedure or the policy book, instead of what one would think of as common sense business practices.
“There is no negotiating with an employee or agent of a bank.”
Bank policy examples:
What follows are examples of bank personnel following policy and not common sense business practices when it comes to processing loan applications:
Example 1:
If you had a billing problem with your cell phone provider, and they reported it to the credit bureau prematurely, the bank employee processing your loan application has no power to overlook it, even if they themselves have had the same problem in the past.
Example 2:
The borrower is a contract worker or the owner of a business and has access to thousands of extra dollars each month from a business account they control. The bank employee, by policy training, must not take this into account.
Example 3:
There is no room to negotiate with an employee or agent of a bank. The rate they quote you, in general, comes with a “take it or leave it” mentality.
The most important difference, when dealing with the bank, is that they do not allow borrowers to participate in the conveyance process, which is where huge, profitable opportunities are presented.
With private lenders, negotiation and allowing the borrower to participate in conveyance is encouraged and accepted as a part of doing business. It presents a win-win situation for both private lenders and borrowers who participate in debt consolidaiton partnerships.
When a bank replaces and pays out another bank through debt consolidation (that is, from bank to bank conveyancing) it is an internal transaction. When a private lender forwards funds to a bank (private lender to bank conveyancing) then it is an external transaction. These types of transactions are handled very differently.
“A debt contact investor can really benefit and take their game to the next level.”
It is even more profitable for the lender and borrower
when the debt is in a collector’s hands.
Collectors buy files from creditors. They do not buy the debt itself. By the time it is in the collector’s hands, the debt has already been sold. When all of this is understood, and conveyance techniques are applied., huge opportunities are presented to the private lender as well as the borrower.
When using bank financing to reduce debt, the borrower is not a part of the conveyance process. As a private investor completing conveyance with the borrower, it is important to be aware of this window of opportunity. It can further your profit potential in a well-negotiated debt contract deal.
When using private financing, understanding equity of redemption and proof of ownership of debts, is where a debt contact investor can really benefit, and take their game to the next level.
When using bank financing, neither the private lender or borrower can use these techniques to build wealth in the debt consolidation industry because the banks do not consider either during conveyance. It truly constricts the creativity in a debt consolidation deal when you are not participating in the conveyancing while using bank financing.
The private lender and borrower must participate in the conveyance process in order to make use of these debt-consolidation, wealth building, techniques.
It all stems from the fact that a private lender, who is transferring money to reduce debt registered against assets, is not only allowed, but expected, to ask for proof of ownership of the debt before forwarding the funds. To be clear, if the bank can not prove ownership of the debt, they can no longer be considered part of the situation, due to the rules of the courts.
Why?
The bank could have sold the debt registered against the asset. If they sold their interest in the debt, they are no longer involved.
“If the bank sold their interest in the debt, they no longer have right to collect further funds.”
There are two types of audits:
- An informal audit, which does not make use of the courts.
- A formal audit, which does make use of the courts.
90% of our deals are informal audits, wherein the court is not involved. We just document our request for proof of ownership of the debt through email. The only situations where we use the court are those which deal with secured debt, in order to remove the lien from the asset.
Auditing a loan is a simple process. This is where discounting and discharging unsecured debts or secured debts registered against an asset is determined. When using the auditing process in conjunction with participating in the conveyancing of your new debt contract, you are able to build wealth by furthering your already well-negotiated debt contract deal.
Discounts are obtained when a creditor can not prove ownership of a debt and has to agree to a lower payout. In reality, they should not receive payment at all, but what you should expect is for a discount. Negotiating a discount through auditing debt is only obtainable by doing our own conveyance. You can see how profiting more in each deal creates more wealth and is a win-win situation for both the private lender as well as the borrower.
However:
If the creditor sold their interest in the debt, they are not a part of the deal. They have no right to collect funds from your new debt contract. At this point, the most important fact is that debt is bought and sold every day. The present creditor could have sold their interest in the debt, allowing you to make a great debt contract deal. If they did sell the debt, we the people, should profit, rather than the collectors or the banks.
Also, if the creditor sold the debt and the private lender forwarded funds to them, the creditor would get double payment. That is very unfair and unreasonable.
If the creditor sold the debt and collected funds while profiting on the sale, are they still an affected party? Not if they sold the interest in the debt, encumbrance or mortgage.
The rules of court are quite clear:
An affected party is the only entity that has the right to collect on a debt registered against an asset.
To repeat the most important fact: If a bank or any other encumbrance holder sells their interest in the debt, they are no longer a relevant party and have no right to collect further funds through your new debt contract.
To be clear, knowing the above information allows you to profit.
“The bank or encumbrance holder is no longer an affected party.”
Let us show you how this can benefit you
by asking and understanding the following question:
What happens when an average person borrows money from a bank?
A family goes looking for a loan, or a higher amount of credit, and negotiates acceptable terms and conditions to them. Next, they sign all paperwork needed to complete the transaction. Bank managers are aware they can keep the debt in their portfolio, or sell it at any time without notifying the borrower.
After three years, the borrower finds themselves in the credit card debt trap. Bear in mind that three years is ample time for a bank to complete this type of transaction. That transaction is simply to sell the debt.
Fact:
Banks buy and sell debt every day. Actually, anyone participating as a private lender in the lending industry is able to buy and sell the debt they have registered against assets. It is very clear that all such registered assets are eligible for exchange.
Now that the private lender and borrower find themselves in a debt contract and henceforth the conveyance process, since they are aware of the above information, here is the most important question to ask yourself:
Are there more profitable situations in this debt consolidation deal that would be of mutual benefit to both parties, than the initial negotiations permit?
The answer is:
It depends if the debt holder sold their interest in the debt. If the debt holder did sell the debt, in doing so they have effectively sold their interest in the debt. Therefore, they are no longer relevant to the contract.
Under the rules of court, it is very clear. If you are not a relevant party and cannot prove ownership of a debt registered against an asset, you can not collect.
With this information, you are well on your way to building wealth in contract debt or debt consolidation with new, revolutionary and dynamic techniques.
Next page
Read the next page: Stages of debt and their opportunities.