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A Little Information On Selling Your Promissory Note
Ok, you are prepared to sell your promissory note. That is fantastic, but
there are some things you should know before you jump in with both feet. What I
am going to do is list some things below that most people are not even aware of
when they go to sell a note. These things will apply to most all notes like
business notes, sell real estate notes, land notes, mobile home notes,
selling mortgage notes and just about
any type of promissory note that is secured by a tangible item.
1. One of the first things you need to do is gather your information on your
note. You should have copies of the documents that were used when you closed on
the property originally. Most of the time the documents that will be required
are: Mortgage documents or a deed of trust, the settlement statement, a copy of
the promissory Note, the payor’s full name, the payor's social security number so
that a credit check can be done on the payor. Typically the note buyer will give
you full details of what documents will be required for you to get your
promissory Note quote.
The main reason that the note buyer asks for all this information is to check
the information that was given to he or she to base there offer off of to make
sure it is all correct. This is really no big deal as I am sure if I was going
to sell you a house, you would definitely want to see it first.
2. Get your documents and information to the note buyer as quickly as you
possibly can, as we have seen note deals take forever because the note seller
did not get the documents to the note buyer in a timely fashion. Do not be the
one that this happens to. Remember your time is worth money and it is the same
for the note buyer.
I have also seen many times where the note owner wants proof of the note buyer
having the funds to buy the note before giving them the documentation requested.
I can tell you from my experience that the best you will get from the note buyer
is a letter of intent or what we call a LOI. This is a legal document that
basically states that if all you have said about your note is correct the note
buyer will buy your note. WeBuyNotesOnline.Com only works with the most seasoned
note buyers in the country, and they are very helpful to the note holders as far
as showing you what all the many options you have are.
Make sure that you consider this when you have decided to sell your promissory
note, as this will save everyone a lot of time.
3. You must expect that there will be a discount on your note. To many times I
have ran into note holders that believe they should get the entire worth of the
promissory note. This will never work as the note buyer must be able to make a
profit on the note or there is no reason to purchase it. As long as notes have
been sold there have always been discounts on the value of the note today. Now
this is not to say that you will not get a great deal, this is to say that if
you think you will get full value of the note you are better off to just hang on
to the note and keep getting the payments until all payments have been made. I
know that at WeBuyNotesOnline.Com we try really hard to get you the best deal
possible on your note.
4. Please be positive that the information you have given to the note buyer is
as correct as you can get it. Here is why. Lets say you send the note buyer
information that basically says you have a mortgage note that is in the 1st
position, that is worth $150,000 and your payor has a credit score of 730. Now
you send over the actual documents and it is actually a mortgage note that is in
the 2nd position, and the payor’s credit score is 600, then it becomes very
obvious that the preliminary quote is going to change because the information
was not correct.
One thing that you must remember when selling a note. The more you can show to
be accurate about your note, the more cash you will get out of it.
5. A couple of last thing to remember. The offer you receive from the note buyer
for your promissory note should be a net estimate, in other words there should
be no hidden fees, and the amount on this estimate is what you will receive when
you receive you check at the closing.
The other thing is to make sure you know what closing costs are being paid by
who when you go to close on this note, as you may be responsible for some of the
closing costs.
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