Being creative when structuring the terms of the deal can often times be a great way to get the most out of a transaction for all parties. Just like any other real estate niche when it comes to notes you’ll want to consider all of your options when you are looking to sell. During times of such economic uncertainty many note holders may find it difficult to find buyers for their notes.
Most note holders in the [market_city} don’t realize that you can actually sell a private mortgage note with owner financing and similar to owner financing a residential property the owner financing strategy can be a great way to increase your buyer pool.
In today’s post we’ll discuss the very little-known method of selling a private mortgage note through owner financing. If you are new to notes entirely don’t worry because we’ll jump into a basic definition of notes and how they work.
How Notes Work
A note is a real estate investment based on a mortgage. It works like this: a home buyer purchases a house and gets a mortgage. The lender provides the mortgage and anticipates the mortgage to be repaid. That mortgage note has value (the future potential repayments) so if the lender wants to access that value, they can sell that note to someone else. A note investor gives money to the lender and, in exchange, is investing the potential of earning those mortgage repayments still to come.
A note is a great way to diversify your investment portfolio out of strictly real estate while still enjoying the potential for cash flow.
What Is Owner Financing
Owner financing is when the owner of an investment carries a mortgage, allowing the buyer to buy from them instead of taking out a loan from a bank. Home sellers, for example, might sell their house through owner financing, accepting regular “mortgage” payments paid to them over time instead of to a bank.
Owner financing is helpful especially if you’re buying an investment and don’t have the capital or credit, or don’t want to spend all of your capital at once but would rather spread out the payments.
Selling A Note With Owner Financing In IL
If you’ve been searching for information about selling a note with owner financing, chances are you’re looking for any of the following possibilities, which may seem confusing.
- You have a note and you’re looking to sell it with owner financing, so that the note investor takes the note but pays you a regular income
- You are looking for a note investor or broker who is selling a note with owner financing in IL, so that you can pay them a regular amount for your note investment
- Or perhaps you have a note on a property that has seller financing and you’re looking to sell that note
- Or maybe you are looking to buy a note from a seller on a property with owner financing
As you can see, it’s potentially quite complicated and there are many shades of meaning to the simple phrase: “selling a note with owner financing in IL”.
Fortunately, we’re here to help sort it all out. Just pick up the phone and give us a call at 630-387-6861. We can walk you through the fuller meanings of each one and help figure out which one you’re looking for.