Learn How to Sell our Real Estate Note
What Is a Real Estate Note?
A real estate note (also called a mortgage note or promissory note) is a legal document that represents a borrower’s promise to repay a loan secured by real estate. IWhen someone buys a property with seller financing or a traditional mortgage, the lender or seller typically holds the note.
The note includes:
- The loan amount (principal)
- Interest rate
- Repayment schedule
- Maturity date
- Collateral (the property itself)
If you hold the note, you’re essentially the lender—collecting payments over time, usually with interest.
Why Sell Your Real Estate Note?
Creating a private mortgage note is often a short-term solution. Sellers either hope to sell an unmarketable property, help a family or friends get into homeownership, or allow a non-traditional buyer to purchase a home. Whatever the reason, seller financing gives them a quick and easy way to accomplish their goals.
Unfortunately, most sellers quickly realize they do not want to manage payments or wait years (or even decades) to cash in on the home’s value, as seller financing requires. So they seek out note buyers who can take the note — and its tedious management — off their hands for a cash offer.
Generally, mortgage note holders tend to sell their notes for one or more of these reasons:
Simplify their life
They may have received it from an estate or inheritance and want to liquidate it
They are tired of managing the note & IRS tax compliance
They are worried about payor default
They want to pay debts, pay college tuition, make a large purchase or another investment
✅ Get a Lump Sum
Rather than waiting 10–30 years for full repayment, you can sell your real estate note for immediate cash—ideal for paying off debt, reinvesting, or covering major expenses.
✅ Reduce Risk
Holding a note means you’re exposed to the risk of borrower default, late payments, or property devaluation. When you sell a real estate note the risk of borrower problems is transferred to the note buyer.
✅ Simplify Finances
Some note holders prefer the simplicity of cash over the complexities of managing a note long-term, especially in estate or divorce settlements.
Who Buys Real Estate Notes?
Typical buyers include:
- Private investors
- Note buying companies
- Hedge funds
- Pension funds
These buyers are looking for passive income and long-term returns. They evaluate the note’s value and risk before making an offer.
How the Real Estate Note Buying Process Works: Step-by-Step
1. Evaluate Your Note
If you decide to sell your real estate note, Potential Note Buyers will assess your note based on:
- Remaining balance & buyer equity position
- Interest rate
- Payment history
- Property value
- Borrower credit
- Remaining term
Performing notes (on-time payments) will deliver much higher prices than non-performing (with payment problems) real estate notes.
2. Get a Quote
You can request a free quote from multiple buyers. Expect to receive less than the note’s full value—often 60% to 95%, depending on risk and market conditions. Be sure you are dealing with a reliable and trustworthy note buyer. You can start the process by filling out the below form or calling (772) 232-2383.
I’d like BEST PRICE for ALL or PART of My Note
Once the note buyer has the relevant information, an offer to sell your real estate note will be made. If you agree to the purchase offer…
3. The Note Buyer prepares a Mortgage Purchase Agreement
Buth the note seller and note buyer then sign the purchase agreement which authorizes the note buyer to spend their money on due diligence.
4. Due Diligence
Then due diligence begins
- The buyer reviews the original documents (note, deed of trust/mortgage, payment history, insurance, etc.)
- The Note Buyer will conduct a title search and property valuation
5. Closing & Payment
Once due diligence is completed the note buyer will prepare the closing package
- When the Note seller signs the closing package…
- The note and related documents are legally transferred
- Funds are wired to your account—often within 1–3 weeks of starting the process
Partial vs. Full Note Sale
You don’t have to sell the entire note. There are options:
🔹 Full Sale
Sell 100% of the note and walk away with a lump sum.
🔹 Partial Sale
Sell a portion of the future payments (e.g., next 5 years). After that period, the remaining payments revert to you.
This allows flexibility—you get immediate cash while retaining some long-term income.
What Affects a Note’s Value?
Several factors impact the purchase price:
| Factor | Impact |
|---|---|
| Interest Rate | Higher is generally more valuable |
| Borrower Credit Score | Higher = less risky |
| Property Value | Higher value = more secure |
| Payment History | Consistent = better |
| Note Term Remaining | Shorter = less risk |
| LTV Ratio (Loan-to-Value) | Lower LTV = more secure, more equity = more secure |
Tips for Selling a Note Successfully
- Keep Detailed Records
Payment history, insurance info, and original documents should be organized. - Know the Buyer
Work with reputable buyers—check reviews, BBB ratings, and experience. - Compare Offers
Don’t accept the first offer. Get multiple quotes to find the best deal. - Be Honest About Risk
Disclose issues (e.g., missed payments) upfront. It saves time and avoids deal fallout later. - Understand Tax Implications
Selling a note may trigger capital gains taxes. Consult a tax professional.
Common Questions
🟡 Is selling a note legal?
Yes. It’s perfectly legal and common. Just ensure proper documentation and title transfer.
🟡 Can I sell a note even if the borrower is behind on payments?
Yes—but it will be considered a non-performing note, which sells at a bigger discount.
🟡 Do I need a lawyer?
No, but it’s wise to have legal or professional help, especially for complex sales. If you feel you’d like your attorney’s advice, then by all means engage your lawyer.
Start by filling out the form below and be sure to check out who we are.
![{market_state] mortgage note buyers](https://cdn.carrot.com/uploads/sites/79478/2024/09/suburban-street.jpg)
See how we can help you!
American Funding Group, is a premier note investor, buying notes in all states. We specialize in residential and commercial performing real estate notes in FL. We love helping noteholders who are in tough situations. We will work with you to find a win-win solution so you get the most from selling your real estate note.
I’d like BEST PRICE for ALL or PART of My Note
Final Thoughts
Selling a real estate note is a strategic financial move. Whether you want fast cash, less risk, or to simplify your finances, the key is preparation and working with trustworthy buyers. Understand your note’s value, explore your options, and move forward with confidence.