Buying real estate notes can, potentially, yield much higher returns for you, coupled with far lower risk, than many other investments available today.
Continue reading “Note buying 101- The basics”
Assuming you already know what mortgage notes are and why many real estate investors are now buying notes as an alternative to brick-and-mortar real estate, this post will show you just HOW to do it.
(Again, I caution you, if you are new to this, I would strongly suggest you broker a few real estate notes first so that you become familiar with the entire process by working directly with professional note buyers.)
Continue reading “How to Buy Mortgage Notes [Finding, Qualifying, Funding]”
This post will show you how to figure commissions using a financial calculator when buying and selling discounted notes.
Sally Seller needs cash to buy a new Jaguar to impress a potential boyfriend. Her only asset is a $100,000 note she took back when she sold her home 5 years ago. You want to broker the note to an investor. The Jaguar costs $80,000. Can you help Sally and still make a commission? We must first calculate the value of the note she is selling, then make her a purchase offer, and then calculate the price the investor will pay for the note. In each case, we need to know the yield or interest rate at which we can buy and then sell the note. You think you can buy Sally’s note for a 10.5% yield and sell it to an investor to yield them 9%. Continue reading “Commission in Discounted Note Business”
Knowing the value of your possessions and assets can make a difference in how you ultimately choose to dispose of or liquidate them. That’s why many people engage the services of antique appraisers, real estate appraisers and other valuation professionals. When you know the worth and value of something, decisions are easier and clearer.
Well, that’s the way many note holders feel, too. Many note holders need the services of a professional note appraiser to quickly tell them the value of their notes. Plus, it’s a distinct bonus if the appraiser also represents an avenue for the sale of that note. Continue reading “Increase Your Income With Note Appraisals– Starting Today”
Unless the buyer is paying all cash, notes are an integral part of every real estate transaction. If the buyer is borrowing money—whether it is from an institutional lender or directly from the seller—he or she has to sign a note. This is the promise to repay the money. The note tells you how much is being borrowed, how it will be paid back, what the interest rate will be, and what security, if any, the lender will have in case the borrower defaults. Like contracts, notes come in different forms. Continue reading “Killer Clauses You Can Put Into Real Estate Notes”
If you can use a financial calculator, you have a very powerful tool for making profits when buying both discounted notes and real estate. We recommend either the Texas Instruments BA II+ or the Hewlett Packard 10b. Both are only about $30. You can easily solve the problems below with either calculator.
Here’s a “twist” on buying a note. One writer says he has been using this idea instead of loaning on your note. He does a pawnshop loan. Here is an example: Recently a developer called up and asked how much we would give him for the following 2nd note which had been seasoned for only
4 months. Here’s the note: Continue reading “Here’s a “Twist” on Buying a Note: The Pawnshop Loan”
In this exercise, you will learn how to buy notes with balloon payments that grow in value as time passes.
You inherit some money from your rich Aunt Harriet. You decide to buy the following note with this newfound cash.
Fill the known parameters and use your financial calculator to calculate the face interest rate on the note:
Continue reading “Earn More by Buying a Note and Then Doing Nothing”
Here are some more financial calculator techniques for building profits buying notes and real estate.
In this Strategy, you will learn how to give a note seller cash plus payments for their note.
Just understanding how to use the term “reverse partial” should make you a pretty boring person at a cocktail party. Reverse partial is a way of buying a note such that the first 12 to 24 payments go to the note seller along with cash for the remaining payments. It is an excellent purchase strategy for sellers who need some cash now and need to retain some of the payments. Continue reading “Buying Notes: Reverse Partials”
The following is another illustration on how to use the financial calculator to create profits in both notes and real estate.
The strategy discussed here is illustrative of ways to manipulate your own mortgage. Even if you don’t do this exact strategy, it should stimulate you to think of ways to handle your own debt.
Once you understand the basic premise of buying discounted notes and have some notes in your portfolio, you have some remarkable options, particularly in dealing with your own home mortgage. Continue reading “Buy a Discounted Note and Lower Your House Payment at the Same Time”
The following tips and tricks for buying and or brokering mortgage notes are just some observations I’ve made throughout the years. They are in no particular order of suggestion implementation, nor by any means all-inclusive.
I do feel that if you put these suggestions into practice, they will help you become a better note buyer and/or note broker by helping you to close more deals. Continue reading “Tips and tricks for buying and brokering mortgage notes”