Posted by John Merchant, Esq. on September 17, 2002 at 11:46:22:
In Reply to: Note seller question - Experts, please help posted by Lori on July 24, 2002 at 14:22:55:
Sounds to me like you need to do some reading of some books and articles re hows and whys of note buying/selling business.
Nobody knows a subject from the get-go, and we've all had to learn this topic from somebody else.
A couple of great sources I'd recommend for you: One, Jimmy Napier's little classic: Invest in Debt...available directly from Jimmy Napier, @ Chipley, FL, number available from information. You'll need to read it a couple of times to get it, because Jimmy hops around and back and forth, but his info is very valid.
Also Lonnie Scruggs sets it out real clear in his little books...one of which is Deals on Wheels, available various places, including direct @ (757)426-2197. He does it so simply I can get it, so you'll have no difficulty understanding the how and why of buying a note at Present Value, as compared to Future Value.
Also there are hundreds of FREE articles available on www.notenetwork.com, and the other note websites, so you can get a post-graduate college education absolutely free but like any education, it will cost you time...and a LOT of money if you don't avail yourself of the opportunity.
And although I'd say it's no great writing, I do recommend you go to www.ree.com and find my article (look at bottom of home page, on p. 2 of articles, under my name) on How to Create and Sell a Carryback Note. It'll give you the basics of creating and selling a note, and what buyers look for.
You should be aware of some legal drawbacks of CREATING a note for sale. In some states this is, if it results in a really HIGH yield to the investor, a USURIOUS loan, which is illegal and uncollectable. In my state of WA, for example, any interest rate over 12% on an owner's carryback note, has been held by the WA Supreme Court to be usury...in more than one decision!
Good luck.