What are Mortgage Notes?
Mortgage notes are just like any other instrument of debt. They can be readily bought and sold, with a primary purpose of increasing the yield of one's investment. To Investors, this becomes a forth level profit center.
To consumers, it's a good option for replacing your savings account with interests payments (that easily can reach 8%!). This is the perfect solution for those self directing their investments. Be on the lookout for 8% notes and higher.
How to buy Mortgage Notes.
Any home loan with private lending (generally in second position, but not always) is a note that can be purchased.
Finding a buyer - Example: There is an investor selling a cash flow multi-unit property. They are going to look for a place to park their assets until they make their next real estate purchase, and are looking to do so for 24 months. Their money is currently in a holding situation with 0%-3% yield. This is your note buyer.
Locate a note holder, public record, receiving interest greater than 8% and strike a deal for them to sell the note. Position yourself as a discount note buyer. This is the note holder, owner or seller.
The buyer will purchase the note at face value for the increase in interest they will recieve.
It's that simple!