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Many private mortgage note owners don’t really know the different options they have with their Mortgage Note or Deed of Trust. As I get many questions about the process of selling a mortgage note or selling a trust deed, I have come up with a list of the most asked FAQs that might be helpful.

Following are ten popular questions:

1. What are the advantages of selling a note? – The two biggest advantages of selling a private note are a) tapping the cash now for higher return investments or unexpected expenses and b) Riding you of the hassles of managing the borrower’s payments, etc.

2. Can I sell part of my mortgage note? Yes.

3. Can you explain the determining factors for how much I will get for my private mortgage? There are 5 critical elements a Normal 0 Mortgage Buyer looks at. They are: the amount of equity in the home, how long the borrower has been paying on the mortgage, the rate of interest on the note, the amount of time remaining on the mortgage and lastly the credit scores of the borrower.

4. Will an appraisal be necessary in order for me to sell my private note? Yes to determine the loan to value of the security. Sometimes, depending on the real estate market, a Real Estate Broker’s opinion will work.

5. Will you need to check the payor’s credit? Yes, it is a key element in determining the lump sum payment for your owner financed mortgage.

6. Will I have to inform the buyer I’m selling the note? Yes. That’s the law.

7. How do I know if the mortgage note or deed of trust has a clause allowing me to Normal 0 sell my note? Just look at the executed mortgage but every mortgage I’ve seen allows for the sale of the note. It’s standard in most mortgage documents.

8. Can I Normal 0 sell deed of trust just like a private mortgage? they are all treated the same.

9. I wish to sell my note for some extra cash but I am worried about losing all the income? Not to worry. Some mortgage buyers can make a partial purchase of your private mortgage for only the amount you are looking for.

10. Is there a minimum note size note investors will purchase? Ours is $30,000.

And Finally, don’t assume you can’t get the payout you want from selling your note or trust deed. There are a number of ways to structure a mortgage sale so as to accomplish your goals. The key, however is to communicate to the mortgage buyer precisely what your goals are. This way they can structure the mortgage purchase to fit your goals exactly.




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Filed under: Real Estate

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