Why do people sell their notes? A variety of reasons, but usually, they just want the cash or have better use of the cash. Sometimes, there is an emotional element that really drives the note holder. Let me share an experience that melds a perfect combination of economic and emotional motivation.
About 10 years ago, I was working with a lady who had a residential land note. Let’s call her Susan. Here is her story: Susan and her husband bought this lot several years prior. It was located in a beautiful area of Northern California and they were making plans to build their dream home. Then, totally unexpected, her husband had a massive heart attack and died.
In time, Susan decided to sell the lot. She found a couple who were interested, but their bank would not offer financing with the lot as a collateral. Susan liked them and agreed to carry the note.
After 2 years of receiving payments, Susan realized that each check she received represented the plan she and her husband had for that lot, a plan that would never happen. Plus, she had gotten a little reckless and accumulated too much credit card debt. Susan needed to pay off that debt, but more importantly, for her emotional and psychological well being, she needed to detach herself from that piece of land. Selling her note would accomplish these 2 objectives.
We found a buyer for her note and the transaction went smoothly. Susan could now pay off her debt, shed a piece of her past that had been draining her, and allow her to focus on moving on with her life. To this day, this experience has been the most satisfying I have had. It continues to remind me that our true job is to try to serve the need of the note holder, and to never underestimate the emotional undercurrent that may drive an economic decision.
