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http://boards.fool.com/theres-been-talk-of-funds-that-ive-seen-in-25101507.aspx
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| Subject: Re: TLCs as the RE market drops | Date: 1/29/2007 4:43 PM | |
| Author: LuckyUte | Number: 45 of 52 | |
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There's been talk of funds that I've seen, in terms of why no one does "tax lien funds" cause it shaves the margins to the point that the risk:reward isn't worth it. But it does seem a bit surprising that there isn't a business built around this sort of thing. For instance: Say I get a tax lien for $10k @ whatever interest to be paid over 10 years @ $2k per year. That stream has an NPV of $14,720 @ 6%, but it's a $20k cash flow net. It seems surprising that there isn't anyone out there buying up this lien and immediately trying to flip it for $12k. Is there a market for this sort of flipping? Seems like it'd be a good play to get into... There are businesses built around it. The institutional investors I mentioned earlier are some of these. For instance, look at these guys... http://www.mooringfinancial.com/mooringtag.htm Also, when I buy and sell in bulk for larger investors (such as the above), I do the kind of analysis you mention. However, most NPV analyses would be at much higher rates than 6%. Does that sort of answer your question? Roger |
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