• I'm holding a note from the sale of my property. Why should I sell it?
  
  Seller carryback mortgage notes and trust deeds are usually sold because the individuals holding them are not in the banking business. Therefore, they don't want the trouble of collecting late payments, and they can use the extra cash for other investments, personal reasons such as college tuition, vacations, purchase of a new car etc. or Maybe you fit one of these categories.
  
  
• How big a discount is there on the note?
  
  It is impossible to tell until we get all the data and documents from you, the note holder. Each note is different. Maturity date, interest rate, number of payments received, the credit of the payor etc. all influence the amount paid for the note.
  
  
• Can you buy a note that is in second position?
  
  We often can if the amount of the second position note is 50% or more than the amount of the first position note. Also, the payor must have good credit.
  
  
• I've heard the term "buying a partial." What does this mean?
  
  

  There are two basic ways to buy a note.

1. The buyer purchases all of the remaining payments due on the note. This is called a full purchase.
2. The buyer purchases a portion of the remaining payments. This is called a "partial purchase."

By buying only a portion of the remaining monthly payments on the note, instead of purchasing all of the payments, the note buyer is able to pay proportionately more for the note. Put another way, he can discount the note less. Very importantly, a partial purchase allows the later return of the note to you, the original seller, who can then collect the "back-end" payments.

For example: There are 50 payments left on a 60 payment 5-year note. We arrange for the purchase of the next 20 payments due on the note. This is also referred to as purchasing a certain number of the "stream of payments." A partial purchase gives you, the note seller substantial cash immediately, and you also retain the right to collect the final 30 payments. The note buyer is in a better secured position with less risk, since he is laying out less cash for the partial, but does move into a first security position on the entire remaining note balance while he collects his 20 payments. This decrease of risk to the buyer with less capital investment is the main reason that he can pay proportionately more for the note.

After the buyer collects the 20 payments, the remaining 30 payments revert back to you, the original note seller. By calculating the cash paid for the note plus the 30 remaining payments multiplied by the monthly payment, the total received by you, the seller (cash at purchase + back-end payment total) is quite attractive. The total amount often comes very close to the original remaining balance of the note at the time it was sold. This is what makes a partial purchase so attractive.

In many cases you are better off financially by selling a portion of the stream of payments instead of the entire note (full purchase). Additionally, what often happens is that after the note is returned to you, the original note seller, you may want to then sell the remaining back end payments a second time to raise more cash.