FREQUENTLY ASKED QUESTIONS:
- What is note investing all about?
As a note investor, you purchase mortgage notes from banks, hedge-funds, lenders and other individual investors. The lender selling the mortgage sends a letter to the homeowner informing them that their loan has been transferred/sold to YOUR company and the date that they should begin sending their payments to you. This creates an on-going, passive cashflow. This can be done with virtually any type of debt, however, debt secured by real estate is one of the most secure forms of debt that you can buy.
- What qualifications do I need to have?
There's no certifications, exams, credit requirements or coursework to complete. We recommend that you board your loans with a licensed mortgage servicer. Most investors don't need to take out a loan because the assets are so affordable. You really just need to receive training on what to do and mentorship as you go through the process of learning. The note business is one in which you learn by DOING; which is why we offer mentorship with our workshops.
- How much do mortgage notes usually cost? How much would I need purchase a note?
Mortgage notes are available at all price points, however the more desirable the asset and the higher the remaining balance on the loan, the higher the cost of the mortgage note. Many second mortgages in this asset class can be purchased in the $2,000 - $8,000 price range and this is the range that we focus on primarily in the workshop. However, students may choose to purchase other types of loans such as commercial loans or first (senior lien) mortgages or non-delinquent (performing/current) mortgages which may be more expensive.
- What types are mortgages are available at such a low cost?
Our business model is to purchase non-performing (delinquent), second mortgages secured the borrowers primary residence. The first mortgage (senior lien) on that property MUST be current. We focus of this asset class because the homes tend to be more attractive and the remaining balance on the loan is smaller (average range of $10,000 - 65,000) which makes these loans affordable for most investors, additionally we receive the highest ROI from this asset class because the homeowner owes past due interest and late fees which we use as leverage to reinstate the loan at a payment that's affordable to the homeowner which then helps the homeowner get back on track and current with paying the mortgage thereby avoiding foreclosure (yes, you CAN foreclose on a home from the second position!). We also show you how to purchase senior liens (first mortgages) as well.
- What ROI can I expect from this type of investment?
In this asset class it's not unusual to receive a double-digit internal rate of return. As with any investment there's risk; however, in the mortgage note space much of your risk assessment is done PRIOR TO purchasing the mortgage note. Therefore you're able to effectively identify and manage your risk on the front end so you have much more control over the outcome of your investment.
- So how does this work from a "numbers" perspective?
Here's one example: I purchased a delinquent $40,000 second mortgage for $3,500. The homeowner had no paid this second mortgage in several years and owed $14k in arrears (unpaid interest & late fees). I allowed him to reinstate the loan by paying only $3,500 (saving him $10,500, avoiding foreclosure, plus I got my initial investment back). He made his monthly payments of $350/month for the next 12 months. I then sold the loan to another lender for $35k (because it's now current and has a year of consecutive on-time monthly payments).
So I spent $3,500 on the mortgage note, got my initial investment back immediately and then made a total of $39,200 ($35k + 12 monthly payments of $350). Although this example is not unusual, not all assets have this same exit strategy.
- What if the homeowner doesn't pay my mortgage?
If the homeowner refuses to pay their mortgage, you can foreclose and take the property. Now you own real estate property for the price of $3,500 plus the cost of the foreclosure action. Not a bad way to acquire real estate.
- What do I need to do to get started?
Visit our REGISTRATION page now and choose the option that's right for you. Our workshop is offered at a price point to fit every budget. Decide on the level of support you desire for your investment business and chose either PLATINUM, GOLD OR SILVER.
The information provided in Bell Financial LLC's webinars and accompanying material is for informational purposes only. It should not be considered legal or financial advice. You should consult with an attorney or other professional to determine what may be best for your individual needs.
Bell Financial LLC does not make any guarantee or other promise as to any results that may be obtained from using our content. No one should make any investment decision without first consulting his or her own financial advisor and conducting his or her own research and due diligence. To the maximum extent permitted by law, Bell Financial LLC disclaims any and all liability in the event any information, commentary, analysis, opinions, advice and/or recommendations prove to be inaccurate, incomplete or unreliable, or result in any investment or other losses.
Content contained on or made available through the website is not intended to and does not constitute legal advice or investment advice and no attorney-client relationship is formed. Your use of the information on this website or materials linked from the Web is at your own risk.