Free PDF E-Booklet
Free PDF E-Booklet
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How to Enter the Note Business
Jon Richards
Note Brokers and note buyers buy notes, mortgages and other types of cash flows
for a lump sum of cash. Because cash now is worth more than a series of small
payments, the note broker will buy that cash flow for a discount from the face
value of the note. For example, you might give $36, 000 cash today to a note
holder for her $40,000 note that has 240 monthly payments. Then you would
receive 240 monthly payments.
Our job is to find the holder of a note and
then offer him or her a lump sum of money to assign that cash flow to us. Within
that job there are many complications, investments opportunities, possibilities
for profit and for a challenging and exciting career!
You can enter the note buying business in
several different ways:
1). By learning how to buy notes from
brokers. With a little training you can become a passive, yet knowledgeable
investor in deeds of trust secured by real estate. You will be able to get
higher and safer yields than most we think ALL other investors.
2). By finding investors and note sellers
you can earn a finder's fee for referring them to note brokers or note sellers.
In other words, by actively looking for people who would like to invest at least
part of their portfolio in notes secured by real estate, and then referring them
to a note broker, you can earn a finder's fee.
3). By locating private party note holders
to see if they would like a lump sum of cash for their notes. You can then refer
them to a friendly note broker who will pay you for your efforts.
4). By developing a list of corporate
institutional investor you can sell them notes you find. They will generally so
all the paper work and will pay you a commission. In most states you do not need
license to do this.
5). You can find and buy notes for your own
portfolio, sell them to private investors, reschedule them for greater profits,
keep part of the note and sell part or manipulate the note in several ways to
increase profits. This is the heart of the business. You will make a profit when
you buy, when you broker, when you sell the notes and when you collect the
payments for your future financial independence.
The author of this article and founder of
Noteworthy was Jon Richards.
He was a college instructor in real estate, an expert in the mathematical
calculations of cash flows and the author of some of the best selling books in
the industry: Calculator Power and More Calculator Power. Mr. Richards was the
publisher of the
NoteWorthy newsletter, until his death in 2003. For
more information about Noteworthy go to
www.noteworthyusa.com
("Reprinted and used with Permission of Noteworthy - 1-2006")
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