How to Make A Business Selling Mortgage Notes
A mortgage note is a type of promissory note attached to a mortgage debt. In some cases, individuals who have seller-financed a property have mortgage notes they are willing to sell. These individuals may be willing to pay someone to help them sell the note to another party. Working as a mortgage note broker can help you earn a percentage of the sale of mortgage notes. Getting involved in this business may be difficult on the front end, but it can lead to potentially large profits in the future.
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Instructions
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Complete licensing requirements for your state to become a mortgage broker. Most states have some type of license requirement for you to get into this field. Other states do not require mortgage brokers to be licensed specifically. If your state requires mortgage brokers to have a license, you will have to register and then take an exam to obtain your license.
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Set up a business entity, such as a corporation or a limited liability company. With one of these entities, you can limit your personal liability for business matters. You will need to file paperwork with your state and pay a filing fee to set up either entity.
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Acquire a business location or set up a website for your company. Some note-selling businesses are brick-and-mortar locations that are designed to work with local residents. Other sellers set up websites and sell notes strictly online. Brick-and-mortar locations will be more expensive, but they can provide you with a perception of professionalism with your customers.
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Advertise your mortgage note selling business. In some cases, you may find it productive to advertise in the newspaper, on the radio or on TV. You may also wish to advertise your business online.
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Network with others in the mortgage industry. For example, you may want to develop relationships with local banks so that they can refer customers to you who wish to sell their mortgage notes.
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Tips & Warnings
When selling notes for your customers, you will need to value it depending on the level of risk that it carries.
