2018.08.31 13:54 | Sean Carter
Are you thinking about selling a mortgage note to cover costs or take advantage of a new investment opportunity? Congratulations. You might have questions on how to sell a mortgage note, so we wanted to take a second and discuss common questions we have heard in the past. Obviously, if you have additional questions, you should contact an accountant for more information.
What Is a Mortgage Note?
In a nutshell, a mortgage note is a lien. If you go to a bank to finance a home purchase, your bank will have a lien against your house. If, for whatever reason, you are unable to make payments on your home, your bank may be able to foreclose on you and you lose your home. A private mortgage note is a lien where the owner of the home makes payments until the terms of the loans are complete. You are essentially playing the role of the bank.
Why Would I Want to Sell My Mortgage Note?
There are a number of reasons why people ultimately decide they want to sell their private mortgage note. Some are for good reasons. If you have a lot of high interest debt or need to pay a bill right away, selling your mortgage note is a good option. However, if you don’t actually need the money or are buying something you could save up for, we would encourage you to not sell as you won’t get the full value of the note when you sell.
How Do I Sell My Mortgage Note?
There are a number of mortgage note buyers out there who would love to buy your mortgage note. If you do decide to sell, keep in mind that they will look at the loanee to ensure they will pay back the loan. This means they may look at their credit score, payment history, balance, etc. The more favorable the factors, the more you’ll get paid. When you look at buyers, be sure to get several quotes, so you can get an idea of how much you should get for your mortgage note.