Question on buying and selling mortgages

I have a question about a business that my sister-in-law is getting into. I have my reservations about whether or not it’s a legitimate money making business and I figure that some here may have heard of it or had experience with it.

My sister-in-law’s father paid to go to a week long seminar in Denver back in January where he learned how to make offers to banks and other mortgage lien holders for significantly lower amounts than the mortgages were worth, say 30% to 40% less than value, then turn around and wholesale the mortgages to an investor for maybe 10% to 15% less than value. Obviously, if this worked, it would be a big money maker if they were to make 15 - 20% of large mortgages.

Anyway, my sister-in-law’s family has been at this business for 2 months now without any luck, as far as I know. But they’re all really excited about how many millions they’re going to be pulling in. Seems they’re counting their chickens before they hatch.

Does anyone have any experience or knowledge of this type of business and if it works as well as what they’re telling me? I don’t want to rain on anyone’s parade if it’s a legitimate money maker.

Let them answer this question: why would a bank sell off perfectly good loans at a 40% discount? In effect losing money.

That’s the problem and it’s doomed to fail.