E. Highway 62 Residential

Blackburne & Sons is pleased to present this purchase money first mortgage secured by a 2,382SF single family residence located on a 6 acre parcel, located in McLoud, Lincoln County, Oklahoma.

The borrower is purchasing this property for $289,900, and will be putting down approximately $86,970 plus closing costs.

Lincoln County is a county in eastern Central Oklahoma. As of the 2010 Census, the population was 34,273. Its county seat is Chandler. Lincoln County is part of the Oklahoma City, OK Metropolitan Statistical Area. In 2010, the center of population of Oklahoma was in Lincoln County, near the town of Sparks. The county has an area of 966 square miles, of which 952 square miles is land and 13 square miles (1.4%) is water. The county is drained by the Deep Fork of the Canadian River. The eastern part of the county lies in the Cross Timbers and the Sandstone Hills, while the western part is in the Red Bed Plains.

As of the census of 2000, 32,080 people, 12,178 households, and 9,121 families resided in the county. The population density was 34 people per square mile. There were 13,712 housing units at an average density of 14 per square mile (6/km2). There were 12,178 households, out of which 34.10% had children under the age of 18 living with them, 61.50% were married couples living together, 9.20% had a female householder with no husband present, and 25.10% were non-families.

McLoud is a town in northwestern Pottawatomie County, Oklahoma and is part of the Oklahoma City Consolidated Metropolitan Area. The population was 4,044 at the 2010 census, a 14.0 percent increase from the figure of 3,548 in 2000. The town was founded in 1895 and named for John W. McLoud, attorney for the Choctaw, Oklahoma and Gulf Railroad. Early day McLoud was known for manufacturing and selling whiskey. Located on the North Canadian River, the original town was destroyed in a flood and was rebuilt on higher ground one mile south. In 1949, the city was recognized as the "Blackberry Capital of the World" when the Chamber of Commerce sent a crate of blackberries to President Harry S. Truman.

In 2019, the median property value was $131,000, median household income was $61,094 with a home ownership rate of 74.1%. The economy of McLoud, OK employs 1.61k people. The largest industries in McLoud, OK are Health Care & Social Assistance (254 people), Retail Trade (182 people), and Manufacturing (168 people), and the highest paying industries are Agriculture, Forestry, Fishing & Hunting, & Mining ($100,104), Construction ($53,750), and Public Administration ($50,000).

The subject property is a single family residnce, located in McLoud, OK. The subject's neighborhood has easy access to highway travel and is located near medical, dining, shopping, and religious facilities. Property demands are reasonably stable in this area considering the economic issues. The typical marketing time in this neighborhood is within 3 months, however some properties sell within 0-3 months for homes that are priced at market.

Built in 1940, this Ranch Style home consists of 2,382SF and resides on a 6 acre parcel. The property is eqquipped with a living room, dining room, kitchen, study, laundry room, 3 bedrooms and 2 bathrooms. It has central heat and air conditioning, a covered 2 car carport, a large propane tank, and private well and septic system. It is zoned RR- Rural Residential and also has a gated entrance. The subject is in average condition and has been well maintained. It contains wood laminate, wood, tile, vinyl and carpet flooring throughout, with granite countertops in the kitchen and stainless steel appliances. The property has a metal shop, a metal lean to, a carport, storage shed and a storm shelter outdoors.

The property is currently vacant and our borrowers are purchasing the subject for $289,900. After purchase, the borrower’s son will be moving into the property. He has signed a lease starting 10/17/21 through 10/17/2023, and will be paying $900 per month in rent.

The guarantors are a husband and wife who will be holding title through a corporation. The husband is 100% owner of the company, working as the presdident, and the wife works as the secretary for said corporation. The corporation is a marketing and consulting company that provides various assistive services for the financial industry such as debt relief, merchant cash advance, insurance and direct marketing.

They report a net worth of $846,743 and have credit mid-scores of 691 & 605. In 2019, they reported $246,913 in adjusted gross income and $317,538 in 2020.

We hired a local Certified appraiser who valued this property with an AS-IS value of $290,000.

At an 8.0% yield to the investors and a 70.0% LTV (Appraised Value) and 69.98% LTV (Purchase Price) this appears to be a reasonable investment. Investing in any first trust deed involves substantial risk, so be sure to read the Risk Factors section of the Offering Circular carefully before investing. A large and prolonged decline in real estate values is possible. Foreclosed commercial properties almost always need to be renovated before they can be leased or sold, so be sure to maintain some liquidity.

You should spread your mortgage investment portfolio out among lots of different deals. If you have $300,000 to invest, you should invest $10,000 to $20,000 in 15 to 20 different fractionalized first trust deeds. For example, if the deal is a $300,000 first trust deed on an office building in Boise, with a $15,000 investment you would own 5% of the loan. By spreading your money out into a bunch of different deals, you are achieving the diversity of a fund without the failed fund sponsor problem. If you are extremely wealthy, you could double (or even triple) my suggested investment amounts, but be careful about pouring too much money into a single deal. We once had a whole building fall into an old coal mine. Ouch.
Be wise and resist investing in any first trust deed yielding more than 9%. I would personally never invest in a first trust deed with a double-digit yield. The payments slowly grind the borrowers into the dust.
Blackburne’s Law theorizes that a portfolio of 8% and 9% first trust deeds will outperform a portfolio of 11% and 12% first trust deeds over a seven-year term. Only our wisest (and eventually the happiest) investors listen to me.
You can also buy some of our smaller deals in their entirety, but I only recommend this if you are richer than Crassus.
It is very easy to lose money in hard money first mortgages, so fight-fight-fight against the temptation to invest in high-yield deals. As Nancy Reagan used to say, “Just say no.” But if you choose 7% to 9% first mortgages, I predict that you will be very, very pleased.
During the S&L Crisis, commercial real estate fell by 45%. Within three years, values reached new highs. During the Dot-Com Meltdown, commercial real estate fell by 45%. Within three years, values reached new highs. During the Great Recession, commercial real estate fell by 45%. Within three years, values reached new highs. Some time in the next decade, we will have another opportunity to snatch up prime commercial real estate at a huge discount. You will be terrified, but when Blackburne and Sons invites you to join a syndicate to buy a nice commercial property at a 35% discount off its prior high, just remember that the best time to invest is when blood is running in the streets. Why not when real estate has fallen by 45%? You’ll never catch the very bottom because historically the bounces off the bottom happen much too fast. Bounce-soar. You will be terrified, but just remember that the best time to invest is when blood is running in the streets.

Blackburne & Sons Realty Capital Corporation--For more information, contact George Blackburne, IV
555 University Ave, Suite 150, Sacramento, CA 95825
Telephone: (916) 338-3232 * Fax: (916) 338-2328
Real Estate Broker -- California Bureau of Real Estate -- License Number 829677
Publicly advertised to California residents only under California Department of Corporations business plan permit.
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