Every day people make the right decision to sell the mortgage note they carried back from the sale of a home. While some folks do keep their seller-financed note for the entire term, more often they decide at some point to sell the note and receive a lump sum of cash.

Why Offer Seller-Financing?

Chances are you sold your house with seller-financing because it was the best (perhaps only) option at the time.

Most people would have preferred to receive a full cash offer for their property. But, for one reason or another, that didn’t happen. Perhaps the buyer couldn’t qualify for traditional bank financing. Or maybe you sold the house to someone you knew and the seller-financed note was created to expedite the sale process.

Perhaps you even thought it was a good idea at the time since you would receive both principal and interest payments on the note. Seller-financing can be a great investment strategy, certainly better than leaving the sales proceeds in the bank earning virtually nothing.

Lastly, maybe it was the best way to get top dollar for your property. Seller-financed homes can often command a premium sales price because the seller is providing a service to the buyer that they were unable to obtain elsewhere.

Why Sell the Note?

Whatever the original reason was for selling with seller-financing, it is quite common for the note holder’s circumstances to change. What was once a reasonable strategy has now turned into a difficult situation for two common reasons:

• No access to the cash value of the note. The payers are only required to pay you the amount you agreed upon and no more. If you agreed to $850 a month for 30-years, it’s most likely that you will not receive any more than that from the buyer. Note holders often realize that they have a better immediate use for the money they’re owed rather than waiting to collect it in small increments over time.
• There is also the stress of collecting payments. Will the buyer pay on time each month? What happens if they stop paying? Are they keeping property taxes and insurance current? Are they keeping the collateral (i.e., the house) in good condition? These real concerns equate to risk which leads to stress.

One or both of these common reasons eventually lead most seller-financed note holders to consider whether now might be the right time to sell their note. Perhaps we’ve just described your situation.

There is some great news when it comes to selling your note!

First, there is no cost or obligation to find out what your note is worth.

Just give us a call and we’ll discuss your expectations and gather the information needed to provide the initial quote. If you prefer, you can also request a quote only by submitting a Fast Quote request on our web site.

Second, you’ll be pleased to learn that there are multiple options available to you when it comes to selling your note.

For example, did you know that you don’t always need to sell the entire note? Absolutely not! In many cases, you can choose to sell only a portion of the cash flow from your note. This is referred to as a “partial” note purchase, and it can be a great way to receive just the cash you need now without selling the entire note.

For example, let’s assume you have 180 payments left on your note. You might choose to sell the next 60 payments for a lump sum of cash. You receive the partial note sale proceeds right away, and the partial buyer collects the next 60 payments.

When those 60 payments have been collected, the ownership of the note reverts back to you! At that point, you will often have the option to sell another 60 payments, or you can always simply start collecting payments again until the note pays off.

Reach out and let us help you decide whether now is the right time to sell all or part of your seller-financed note.

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