How to Make Money Finding Cash Flow Notes

There is money to be made buying notes.

Cash flow notes are privately held notes that represent a loan given from one private party to another. Banks are not involved. Sometimes the note holder or the person giving the loan, wants to cash out sooner because he wants his money back for other reasons, such as an emergency or another investment. By locating people who hold notes who need or want to sell them, you are in a position to make money.

Things You'll Need

• Computer with Internet connection

Instructions

1. Ask your friends and family if they hold any notes that they would be interested in selling. Place ads on the Internet in free ad websites or specialized websites that list notes. Two websites to check are nbdc.net and topix.com.

2. Find out how much the note is worth. Explain to the note holder that by getting cash today, they will have to sell their note at a discount. A reasonable range of discounts to expect is anywhere from 10 to 60 percent.

3. Find a hard money lender or other investors who like to purchase notes. A hard money lender is someone who lends money to someone to purchase real estate based solely on the equity in the real estate, not based on the borrower's credit. Ask them to make an offer on your note. Please note that there are no banks involved ever in the note buying and selling business. You are acting as the broker or middleman in these transactions between note holders and private investors and hard money lenders.

4. Go back to the note holder to see if they will accept the offer. If they will, have both parties separately sign a non-circumvent agreement so that you will receive a commission.

5. Introduce the parties, receive your commission from the buyer, and send the buyer and seller on their way to close the deal.

References

• cash flow business

Resources

• NBDC: Notes for Sale
• Topix: Mortgage Notes for Sale