Cash Notes for Sale
Cash notes for sale are a type of investment product consisting of legal contacts for land, property, business assets and financial notes. Cash notes are secured by real property or legal tender that can later be sold for profit.
A variety of cash notes for sale exit. The most common include: real estate notes and land contracts, seller carry back trust deeds, structured settlements and annuities. Investing in cash flow notes can be profitable for investors that engage in due diligence and understand the process involved.
Real estate notes and land contracts are secured by tangible property. Note holders can sell all or part of the note to real estate investors. Sellers who need a lump sum of cash might sell part of a real estate note to obtain necessary funds. Others might sell mortgage notes for property being used as rent-to-own or involved in seller carry back financing.
Seller carry back trust deeds are a popular cash flow investment. This type of creative financing can be used with residential and commercial real estate and businesses. Seller carry back financing requires the seller to act as a lender for either the first or second mortgage.
If sellers offer 100-percent financing, they will be the first lien holder. If they provide a portion of financing, sellers carry the second mortgage and buyers obtain financing through traditional lenders for the balance.
Investing in real estate notes requires careful deliberation. It is best to hire a real estate attorney to draft seller carry back agreements, review real estate contracts and file property record transfers.
Another popular cash flow note investment involves business notes. Business owners use assets as collateral to secure funding for expansion or to sell the business to a new owner. The three primary business cash notes that can be sold include: factoring, purchase order funding, and seller carry back financing.
With factoring, account receivables are used as collateral to secure the funding. Receivables are sold to a funding source referred to as the Factor; private investor, credit union, bank, or investment group. Purchase order funding uses customer PO's as collateral. Seller carry back financing for business notes is similar to real estate carry back financing.
Structured settlement and annuities are prearranged financial agreements. Structured settlements are often used to make restitution to a person who has been injured through negligence or to payout lottery jackpot winnings.
The purpose of structured settlements is to payout large monetary awards over an extended period of time. This method is particularly helpful to individuals injured in accidents which require ongoing medical care. Receiving annuity payments ensures they will have necessary funds to maintain a good standard of living.
Recipients of annuity payments can sometimes sell all or a portion of structured settlements for lump sum cash. However, Annuitants must obtain court authorization and demonstrate a true need to sell annuities. Courts rarely authorize selling annuities in whole, but will consider partial annuity sales.
Cash notes for sale offer multiple options and often are less risky than other types of investments. It is imperative to work with honorable professionals and obtain legal counsel. Doing so can decrease risk factors and improve profit margins.
We offer several cash notes for sale investment opportunities at SimonVolkov.com. Take a moment to subscribe to our Investor's Club RSS feed by entering your email in the subscription box on the left sidebar. Learn more about investing and how to turn a profit with cash flow notes by browsing our note investing article library.
Published on March 05, 2010 at 03:02 AM