Here are some common questions I get from note holders who are considering selling their note:
- I live in a different city and/or state than you. How do you handle the closing when I am so far away? We will close at the same Title Company you used when you sold this property. Or, we can overnight the closing documents directly to you with an instruction cover letter. You sign the documents in front of a notary and overnight them back to us with the original note and deed of trust.
- How do I receive my funds? Your funds will be wired to the Title Company we are using or directly to your account if we are not using the Title Company.
- How is my buyer affected when I sell my note? He isn’t. The terms stay the same. The only change is where your buyer sends his monthly payment.
- Do you talk to my buyer during the process? Yes. Before closing, a courtesy phone call is made to your buyer, introducing ourselves and explaining that we are buying the note. The buyer is assured that nothing is changing and we want to ensure that he agrees with the note terms, note balance, etc.
- I like my buyer and monthly income, but I have a small cash crunch. Can I use my note to get the cash I need? Yes. You can sell part of your note only. Let’s say your note is 240 months and you have received 10 timely payments so far. You could sell, for example, 50 of the remaining 230 payments, retaining the contractual right to receive the last 180 payments. You would compare this option to other cash sources you have, then make the best decision for you.
Another frequent comment/question I get is this: “I like the interest and monthly payment from my note. I don’t really need the cash. Why should I sell at a discount, makes no sense to me?” The answer is you do not sell. You don’t sell until you have better use of the cash and can get a better return with that cash. Then, you call me and get some pricing for your note.
