Note Buyers

Note Buyers vs Note Brokers

October 7, 2015 by Nationwide Secured Capital

Many believe that the terms “note buyer” and “note broker” are the same, and that either can be used to describe a company which buys mortgage notes in exchange for cash. However, there is a key difference which is important to understand, and it may seriously impact you if you do not.

Note brokers are like real estate brokers.It is their job to bring sellers and investors together by locating mortgage notes for sale and buyers. The broker acts as the middle man, dealing with the transaction between the investor and seller. Funding does not come from the broker. They have to find funding from either an investor or note buyer, which can increase the time it takes to sell your note.

However, despite this, there are benefits from using a broker. There are far more note brokers around than there are note buyer, so the chances are there will be one around locally.

So, what makes a note buyer different? Unlike brokers, note buyers are usually big companies that offer their services across America. A third party is not needed as buyers can get notes straight from the seller.

Take, for example, Nationwide Secured Capital. We can buy mortgage notes directly since we have our own funds. As you can imagine, there are multiple advantages of using a note buyer over a note broker.

One bonus is that transactions take place much quicker. The buyer doesn’t have to go looking for an investor to put up the funding. Another plus is the clear underwriting. Buyers will have particular guidelines which determine whether they can make a purchase and, with a note buyer, they are able to notify promptly whether they can or not.

Experience is important in this industry, and note buyers have plenty of it. You have to be a note broker before you can become a note broker, and Nationwide Secured Capitals 17+ years as a broker is invaluable experience.

As you can see, note buyers and note brokers have differences, and both have their benefits. Ultimately, you must make the decision about which you would rather use.

Sell Your Note Here

WHAT IS YOUR EXISTING NOTE WORTH IF YOU DECIDE TO SELL YOUR NOTE

August 28, 2015 by Nationwide Secured Capital

If you have followed the guidelines presented in this Series to structure, create and maintain your note, your note is likely to be a sound investment for yourself, or others – you can then choose to hold the note and enjoy the interest income from the loan you made OR you can choose to sell some or all of the loan to an investor or investment company that makes these investments.
Whether you are keeping the note as an investment for yourself, or for possible future sale, it is VERY important to manage the note according to guidelines in “The Note holders Handbook” available from Nationwide Secured Capital while you are collecting the payments: This assures, that if you ever do decide to sell your note – you will receive maximum value for sale of your note.

You can obtain your complimentary copy of “The Note Holder’s Handbook” on-line, order at:
www.NationwideSecuredCapital.com/notevalue.cfm

If you do want to know the market offers available to you for sale of your note, make sure you work with a reputable investment company that has expert underwriters on staff who can and will give you an accurate and reliable appraisal of current market value of your note and can provide cash offers if you decide on selling.

Trust your instincts when you talk to “note buyers.” If you feel like you just walked onto a “used car” lot, and/or are experience pressure sales tactics – you probably did – walk away – these are not real investors. If think that your “buyer” doesn’t know much and/or doesn’t ask enough information about the note you are selling -walk away – these are not real investors – would you buy a house sight unseen? Or an investment that you know nothing about? Most of these “buyers” are brokers have never used their own money to buy a note, and they often have no idea what real investors are looking for.

There are countless thousands of novice and even a few unethical brokers and buyers, who advertise to “buy your note” and will give you fast offers at an ideally high price that is more likely to drop, than not. They give you the high price out of lack of knowledge or to “get you under contract”, so they can do their homework later. And they always give you plausible explanations as they lower their price along the way to closing.

Real investors and seasoned brokers never offer quick and firm pricing – and there is no pressure to sell your Note. They do their homework before they make an offer – they look at your documents, the property and the borrower(s). And all of your questions about the process and the pricing will be answered.

Credit of your borrowers is one of the most important factors affecting the value of your note – any value or offers you are given without checking credit of the borrower(s) – are not firm and accurate.

If you want a professional “no cost, and no obligation” appraisal of the value of your note, and to find out more about the options to pull cash from your note, simply enter the details regarding the loan you gave at

www.NationwideSecuredCapital.com/SellYourNote.html

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HOW TO MAINTAIN YOUR NOTE AND YOUR LOAN FOR MAXIMUM VALUE

August 25, 2015 by Nationwide Secured Capital

Once you have sold the property, and created your note and are collecting loan payments – there are some very important ways that you will keep your loan at maximum value.

A partial list is –

Keep the original loan documents – particularly the original promissory note – in a safe and secure location like a bank deposit box
Monitor tax payments
Monitor insurance coverage on the property
Keep careful records of payments and deposit to bank account.

You can obtain a complete list of ways to maintain your Note at maximum value in a complimentary copy of “The Note Holder’s Handbook” available from Nationwide Secured Capital – order at: www.NationwideSecuredCapital.com/notevalue.cfm
and you will receive a comprehensive guide – AT NO COST- with the most important steps you can take to protect the value of your note – steps that will maintain your loan at peak value for yourself, and in case you ever decide to sell your note.

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HOW TO STRUCTURE A NOTE FOR MAXIMUM VALUE

July 13, 2015 by Nationwide Secured Capital

For a Note of maximum value, Consult with the guidelines written below (updated as of July 2015) on how to structure the Seller Financing for the property you are selling.

1.a) Recommended Interest Rate for owner occupied 1-4 Unit Residential:

0-8.5% for a 720+ credit score
0-9.5% for a 600+ credit score
0-11% for below 600 credit score

Add 1% to the rates above for Commercial properties, 2nd homes and vacation properties
Add and additional 1% to all rates Non-owner occupied residential or Commercial properties.

1.b) Credit score of your buyer/borrower(s) should be over 600, preferably over 625. Don’t sell to Buyers with credit scores of under 600, unless you will keep the Note and are happy to deal with added risk of foreclosure due to default – which is a strong possibility. You might think the Bad Credit buyers are the only ones who need Seller Financing to buy a property. That isn’t the case. Self employed buyers, buyers with average credit above 600, and buyers with a number of real estate investments are often turned down at the bank. With Seller Financing, you can attract many Buyers who cannot get traditional lender or bank financing, e.g.:

Self Employed Buyers
Successful investors who own too many properties for the bank
Fair, good, and high credit buyers that just had a divorce, bankruptcy, or a not so recent foreclosure that disqualifies them for a bank loan.

1.c) Include a 5/7/10 year Balloon due date on a 30 yr amortized loan. This makes the loan more valuable, because in the case of rising interest rates, the interest rate can be increased if the buyer does not refinance and payoff the balloon.

1.d) Always get a Cash down payment, zero down loans are heavily discounted on resale:

10% or greater for owner occupied, 20 % recommended

20% or greater for non-owner occupied, 25% recommended

30% or greater for commercial property or a sale of a business

1.e) You can and should sell at FULL market price for the property if you offer Seller Financing.

1.f) You may optionally charge, 1-4 percentage Points for the Seller Financing loan you are providing, and for creating the Note and mortgage documents. This is similar to a bank or lender, and it improves your total cash out from the sale.

1.e) If you do not get the recommended cash down payment, you can create and carry an additional 10% second mortgage loan that you do not sell. In the current tight RE market conditions, this improves the amount investors will pay you for the primary loan that we are purchasing and gives you better total cash out in the long run.

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HOW TO SELL A NOTE – CASH TODAY VERSUS CASH IN THE FUTURE

July 13, 2015 by Nationwide Secured Capital

In many cases, if you are selling a property that is free and clear – and don’t have a better use of the cash that will come from the sale — and you don’t mind watching the taxes, insurance, calling for late or missed payments, and handling any delinquencies- then holding the loan for sale of your property at a good interest rate, is a good financial decision, and can be a good investment.

When you do have a better use for the cash — or simply do not want to deal with the details, work and risks of taking the property back in case of default, then you can Sell your mortgage note to an investor like Nationwide Secured Capital. We will be happy to give you our offers for the note you are creating — and to make suggestions on how you may make your note more valuable.

***STEP 5) Fax to NSC the signed contract of sale, any terms of the Note you want to create (hopefully you have consulted on these with us in advance before finalizing the loan terms to the seller), and the completed 1003 Loan Application and Authorization to Release Credit, 1004 appraisal if you have one — otherwise, a Realtors CMA based on comparable sold properties in the area).

***STEP 6) NSC will do preliminary underwriting review and tells you exactly what we can pay for the Note with this Buyer, based on:

Buyer credit (we obtain the credit report)
Note terms you have indicated, and/or those we recommend
Represented value of property

NSC provides a written purchase agreement for your Note, and will proceed with a purchase of your note that will typically close after the first payment has been received by you.

***STEP 7) You decide if this Buyer is acceptable, based on our review, suggestions to maximize value, and pricing of our offer – and you move forward or turn them down based on credit review and offer on your Note.

***STEP 8) When you decide to move forward, and you sign the NSC purchase agreement, you should order the 1004 appraisal with interior photos, and submit this to us for validation of the property value. All remaining documents are created and submitted, such as the Note, the security agreement(s), Insurance Binder, etc. You close with your Buyer.

***STEP 9) NSC purchases your Note in one of two ways:

We purchase the Note after you receive your first payment. (If Note is from sale of a business, we purchase after the first 4 on time payments are received by you.)

You receive LUMP SUM CASH instead of small monthly payments!

This is a great way to sell your property faster, and collect CASH for your equity, allowing you to MOVE ON NOW to your new home, next project, or next investment!!!

If you have any questions on this process, or to get a consultation appointment (after you have found a Buyer) to discuss structuring the Seller Financing for your property that you are preparing to sell, send email to consult@NationwideSecuredCapital.com

We look forward to hearing from you, and helping you understand how to sell your property FASTER and GET LUMP SUM CASH in your pocket through sale of the Note!

Related Articles

http://nationwidesecuredcapital.com/Sell-My-Note/seller-financing/
http://nationwidesecuredcapital.com/Sell-My-Note/the-process-of-selling-your-property-creating-a-note/
http://nationwidesecuredcapital.com/Sell-My-Note/how-to-sell-a-note-cash-today-versus-cash-in-the-future/
http://nationwidesecuredcapital.com/Sell-My-Note/how-to-structure-a-note-for-maximum-value/

THE PROCESS OF SELLING YOUR PROPERTY & CREATING A NOTE

July 13, 2015 by Nationwide Secured Capital

As a general rule for best value of the Note, we recommend the following basic guidelines in structuring and creating your loan/Note. The guidelines are NOT REQUIREMENTS, however, if you decide to sell with less downpayment than recommended, or with lower interest rate than recommended, or without the recommended documents, or to someone with truly bad credit, you won’t be able to sell your note later at the best pricing. And, in some cases, other buyers won’t even consider your note — although Nationwide Secured Capital Buys More Loans, and can provide cash out from almost any loan you make — the amount of the loan you can sell may be limited.

***STEP 1) For a Note of maximum value, Consult with the guidelines in Part 5 of this Article on how to structure the Seller Financing for the property you are selling.

***STEP 2) Offer and market your property for sale with Seller Financing (owner financing), and with the parameters listed above – at full market price.

Check recent sales in your area and current listings through a realtor. If other sellers have had to drop their price to sell – you do not have to – you can sell at full market price because you are offering Seller Financing to a buyer who does not qualify for a bank loan, and who needs the property. You can even set a slightly higher price – the only limitation is that the house must appraise at or near the sale price you set.
You may want to go ahead and order a 1004 appraisal from a licensed appraiser in advance of marketing the house to help you set the price – and it will greatly aid receiving a firm purchase commitment on your Note

***STEP 3) Find a Buyer. Sign a standard real estate purchase contract with Seller Financing, and be sure that the Seller Financing clause of your contract includes the phrase “financing terms subject to credit review and approval”. This will allow you to set the offered financing terms based on the sellers qualifications or even allow you to exit the contract, if the buyer’s credit does not measure up as a reasonable risk to make the loan .

***STEP 4) Immediately have the Buyer(s) fill out & sign the following forms (available through the NSC website, email consult@NationwideSecuredCapital.com for the link):

Standard 1003 Loan Application
Authorization to Release Credit

***STEP 4) Work with a Note investment firm like Nationwide Secured Capital who will review and make an offer for the loan, with suggestions on how you can maximize value of the loan – See Part 4 following. You may also want to consult a License Mortgage Originator to obtain credit and qualify your buyer according to new Federal Laws for creation of private mortgages.

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Note Buyers: Who Are They and How Do They Benefit You?

June 10, 2015 by Nationwide Secured Capital

If you need to sell your home for its maximum value, regardless of the reason, opting to sell it to a note buyer is almost certain to be the perfect answer. With a team of expert note buyers, Nationwide Secured Capital purchases property throughout the United States. If you are unfamiliar with what a note buyer is, as well as how the process of selling your home to a note buyer works, the following will provide you with all the answers you need, as well as a look at the benefits you will experience.

What is a Note Buyer?
Occasionally referred to as a real estate lien buyer, a note buyer is one person or a group of people who purchase real estate notes (mortgage loans) and contract deeds on residential, commercial, and manufactured properties, as well as land in exchange for cash. In some situations, a note buyer will pay cash for a structured legal or contractual settlement, lottery winnings, or life insurance policy.

A Quick Look at the Note Buying Process
After you contact Nationwide Secured Capital by filling out a simple information worksheet and request a free quote, our underwriters will evaluate your note at the maximum cash purchase offer. In addition, we will make you aware of any important variables or other information that can impact the market value of your note from day one. We do not charge any fees up front or at closing. At the time of closing, you will receive the full contract purchase price of your note.

What are the Benefits of Working with a Note Buyer?
There are numerous advantages associated with selling your home to a note buyer including:

It maximizes the amount of money you receive. When you sell your home through a real estate agency, you are responsible for paying your agent a percentage of the selling price, which cuts into your money. When you sell your home to a note buyer, you receive the full contract price.

You receive your money quickly. Again, selling your home through an agency takes time and effort. Once you accept an offer, which may be as little as a week or over an entire year after your home goes on the market, you usually have to wait another 30 days for the closing, where you will finally receive your money (minus the seller fees, of course).

You won’t have to go through the tedious process of selling your home. From cleaning and repainting to renovating and staging, selling a home is not easy. In fact, it is not unusual for a homeowner to have to put money into their home in order to sale it.

You will get the cash you need now to accomplish your goals. While this primarily applies to individuals who are selling a settlement, lottery winnings, or life insurance policy that will no longer have to wait to collect their monthly payment, it is also beneficial to anyone selling a mortgage note. For example, if you want to go back to school, but don’t want to take out student loans, you will have the money you need.

You can use the cash to pay off other debts. If you have a significant amount of high-interest rate credit card and loan debt, you can pay it off with the money you receive and move on with your life. Getting rid of the financial responsibilities you are holding over your head will give you freedom. You can work on your credit, try something new, travel, start a business, or anything else you simply can’t do right now.

If you are ready to sell your mortgage note, it is important to work with an experienced note buyer you can trust. Nationwide Secured Capital is ready to help you complete this process as quickly and easily as possible.

HOW SELLER FINANCING CAN WORK FOR YOU

June 4, 2015 by Nationwide Secured Capital

HOW SELLER FINANCING CAN WORK FOR YOU

Are you thinking about selling your property TODAY?
Do you need to sell it QUICKLY? Maybe you need ALL of the money NOW, or have relocated or found another house to live.
Has your property been sitting on the market longer than you want?
Do you have interested buyers but they are not qualified for a traditional loan at the bank?
Can you NOT “wait it out” until market conditions improve for it to be easier to sell your property and get what you are looking for?
DO YOU WANT TO SELL YOUR PROPERTY FAST?!?!

If you answered “Yes” to any of the above, then read on.

Creating a Seller Financed Mortgage Note will help you sell your property FASTER in any market…AND you can also walk away with cash in your pocket shortly after closing when you create your note correctly

What is a seller financed mortgage note?

The seller takes on the role of the lender. The seller extends credit to the buyer in order for the buyer to purchase the house.

WHAT IS A SELLER FINANCE NOTE AND HOW IT CAN HELP YOU

The pool of eligible buyers who are qualified to purchase your property with a loan is considerably smaller than it was a few years ago. This is due to the collapse of bank lending from bad loans the bank made. There are now many good buyer/ borrowers out there who cannot obtain a bank loan. There is no place for them to turn. They would love to buy your property!

NOTE OVERVIEW

A Seller Financed Mortgage Note, also known as a promissory note (Note), is a written promise by the buyer of your property to pay a certain amount of money in the future – normally as a series of payments, and its’ payment in full is normally secured by property that you have sold to the buyer, (the property acts as collateral guaranteeing you will be repaid).

You can loan money to your buyer (and become a lender), when you sell your real estate. You do this with seller financing and carry back a Note. You essentially provide them some or all of the money they need to purchase your property or business – with the agreement that they would pay you back with interest. Normally the property acts as collateral on that loan.

SELL YOUR PROPERTY FASTER WITH A NOTE

A Note will help you sell your property FASTER in any market because:

Seller Financing is faster than a traditional loan. It can happen as quickly as 21-30 days. This solution is great for Rehabbers & Flippers.
You increase marketability of your property by at least 20-25% if you offer Owner Financing because you are able to attract an expanded and larger pool of buyers who do not qualify to the stringent traditional bank loans in today’s market; e.g. lower credit scores, good credit with past bankruptcy or foreclosure, poor credit.
You are offering a financing Solution for Properties that Banks don’t fund…these are outside the Bank-box. Some Properties (and Buyers as mentioned above) do not qualify for a traditional bank mortgage due to bank restrictions; e.g. Mobile home & land, Churches, Mobile home parks, Storage units, Gas Station and/or Convenience stores, Land notes, etc.

A benefit is receiving top value. You can get full market value for your real estate. Since you’re able to sell to someone who can’t qualify for traditional a mortgage, you can get the price you are asking for. Banks and mortgage lenders rarely lend over the appraised value of a property.
Another benefit is Cashflow, Receive a steady stream of income. This is if you don’t need/want to have all the money at once; e.g. avoid taxes.

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