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What is a cash flow note? A cash flow note is a written document that states a promise to pay, and the terms which include the amount, the interest rate and the length of time. A cash flow note may be a mortgage, a trust deed, a deed of trust, a business note, a court award (such as a structured settlement), lottery winnings, annuities, etc.
Why would I want to sell my note? There are many reasons you may want to sell your note. You may prefer to have a lump sum of cash now, instead of small monthly payments. You may need immediate cash to pay medical bills, tax debts, or credit card debts. You may want to take your dream vacation, or purchase a new home or business. You may need money for a college education or retirement. You may be involved in a divorce, distribution of partnership, or division of inheritance. You may have the opportunity to invest the same money in other investments which may be more profitable. Or you may simply prefer not to worry about delinquent payments or having to foreclose if the payor defaults on the loan.
What kinds of notes will you buy? We can purchase any type of cash flow note, including mortgages, trust deeds, and deeds of trust. We will purchase both 1st and 2nd mortgages on any type of real estate, including residential, commercial, and land notes. In addition, we purchase mobile home notes, and business notes (1st mortgages only). We can also purchase structured settlements, lottery winnings, annuities, and inheritance notes.
Why should I sell my note instead of taking out an additional loan? You can certainly take out a loan to cover any financial needs you may have, and may even be able to use your note as collateral. However, there are some disadvantages to this also. Firstly, it increases your debt load, while decreasing your net worth. Both of these factors combine to decrease your credit worthiness and credit score. By selling your existing note, rather than taking on additional financing, you increase your net worth without adding any additional debt load. In the event that you need to pursue financing in the future, this will increase your overall credit score and credit worthiness.
How much will my note be discounted? Many factors will affect the current value of your note. If you are selling a real estate note, these will include: a) where the property is located, b) the type of property secured by the note, c) the value of the property, d) the interest rate on the note, e) the terms of the note, f) how long it will take to collect all the payments, g) the equity in the property, h) the payment history of the note, i) the amount of seasoning on the note, and j) the payor’s credit rating. Similar factors will affect the value of business notes, and other types of cash flow notes as well.
Why isn't there a standard discount offered? Each note is different and must be evaluated based on its own merits and risk factors. A good analogy would be to ask "How much does it cost to buy a car?" There is not a standard answer to that question. It depends on what kind of car: make, model, year, mileage, condition, V6 or V8 engine, type of seat coverings, special features (such as power steering, power breaks, sunroof), etc. Evaluating a note is similar, and, as a result it is impossible to fairly apply a standard discount.
How do I go about selling my note? Once you have decided that you would like to sell your note, we will ask you a number of questions regarding the note itself and the property or business secured by the note. Once we have gathered all of the necessary information, we will locate a buyer for your note and present the best offer to you for your consideration. Once you decide to accept the offer, we will assist you with the process of closing your note sale.
Do I have to sell the entire loan amount? No. You can sell all or part of your cash flow note. We offer a number of attractive sales arrangements. We will try to determine your individual financial needs and guide you in determining which of these arrangements best fits your situation.
How long does it take to receive my lump sum cash payment? Generally, a typical sale takes 4 to 6 weeks to complete, provided there are no unusual circumstances that arise during the sale.
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