Note Buyers – What Type of Notes Do We Buy?

Note Buyers purchase the following types of notes:

  • Real Estate Notes
  • Business Notes
  • Secured Notes
  • Non-Performing First Loans
  • Non-Performing Second Loans
  • Commercial Notes
  • Partial Notes “This is one of our Favorites”

Real Estate Note buyers

buy notes that are secured by real property. Real Property can be single family homes,townhomes,condos, duplexes, triplexes, fourplexes,land or larger apartment complexes. The real estate note will have been created when the property was sold with owner financing often called seller financing. Owner/Seller Financing is when the owner of a piece of property carries all or part of the purchase price of the property. A note is created during the sale of the property and is secured by a security instrument called a mortgage or trust deed (deed of trust). The resale value of the note is drastically affected by the quality of the real estate promissory note and security instrument.

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Partial Note Purchases

 in many situations it makes better sense for the both the seller and buyer of a note to sell just a fraction of the note. When a note is sold as a partial there is less risk for both parties and therefore less of a discount is applied to the note during the sale.

Other Types of Note Buyers

Business Note Buyers

buy notes that are created when a business is sold and the seller of the business carries back a note. Again the resale value of a business note is very depended on the quality of the note when it is created.

Non-Performing Note Buyers

typically buy notes that were once bank notes or mortgages. Non performing notes buyers typically expect a very large discount and buy 1st position notes for 30-40% of the fair market value of the real property and 2-15% of the face value of the note on second position notes.

Types of Notes most note buyers do not purchase

Most Financial Institution notes including:

  • Single Family Home Loans
  • VA Home Loans
  • FHA Home Loans
  • Purchase Money Loans
  • Home Refinance Loans
  • Condo Loans
  • Investment Property Loans
  • Conforming Loans
  • Jumbo Home Loans
  • Reverse Mortgage Loans
  • Rural House Service (RHS) Loans
  • Fixed Rate Loans 10 years, 15 Years, 20 Years, 25 Years and 30 Years
  • Adjustable Rate Interest Loans
  • Home Equity Loans
  • Consolidation Loans
  • Construction Loans

Almost all no private note buyer buy institutional notes as there is little opportunity to make a profit.

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