Sell A Note

When you own the note on a home or other piece of property, the mortgage payments you receive can mean regular income for yourself. However, they can also mean accounting headaches and a tiny income every month. Even if the payments are a few thousand dollars, having the cash in hand for that mortgage may be a better option to you. When this becomes the case, it’s time to sell a note that you own.Deciding to sell a note is not something you want to do hastily or lightly. It means walking away from the ownership of that loan and means having one lump sum of cash, typically less than the overall value of that note, versus the monthly payments that you get. Some would prefer to have the monthly payments for whatever reason, and this is their prerogative. However, to decide if you should sell a note, consider how the process works and what is involved.

First you need a buyer before you can sell a note. This means going online and finding a company or individual that buys up these notes and mortgages. You then need to know the terms of that purchase from you. Again, you typically don’t get the entire amount of the overall loan when you sell a note as the buyer needs their profit margins as well. As you shop for prospective buyers you should ask about their terms and make some notes so you know which offer the most.If you’re going to sell a note, consider what loss you would take now versus the gains you may have. As an example, you may want to have cash on hand so you can invest in another business. While you may lose a few dollars in the value of the mortgage you’re selling, this may pay off in the long run if you invest in a more profitable business.

Obviously it’s difficult to know if a new business will be successful and how much success you might enjoy, but you can often do a bit of figuring to have some numbers to compare. This will tell you if you should sell a note now.You may also want to sell a note in order to address other financial expenses at the moment, such as medical bills, college tuition, and so on. If you were to get out a loan to meet these expenses, how much would you pay in interest rates and fees? The few dollars you lose when you sell a note may be nothing compared to the dollars you spend on that interest.Some will sell a note simply so that they can walk away from the loan itself, and if this is your desire, then there is no amount of money that can replace this. Being able to retire or just being able to forego the paperwork involved when you own a mortgage can mean that it’s well worth it to sell a note.