Process of Getting Cash for Your Note

2013 July 5

One of the first questions I receive when someone is seeking cash for a note is how the process works. It’s fairly simple and it happens in steps. Following are those steps for a typical note sale. The reason the process is done in steps is to avoid spending money on title or valuation unnecessarily.

  • After the initial call or quote request via our website, we provide you with a quote for selling your note. If you like the quote and give us the go, we send you a purchase agreement to sign. The note purchase agreement covers all the particulars such as which payment we start with, the current balance, price, etc. That way, there are no surprises when it comes time to close and fund.
  • Once we receive the signed note purchase agreement, we pull credit on your borrower or borrowers to see how it looks as compared to what we were told in the quote request.
  • If credit is much below what we based the quote on we will either not buy the note or will adjust our quote accordingly. You have the option of accepting the new offer or cancelling the agreement.
  • After we are past the credit stage, we order a valuation of the property. This is usually done by a Realtor but sometimes we order a full appraisal depending on the property and situation. If the value and property are satisfactory, we then place an order for title work and request proof of timely payments for the last 12 months. Hand written receipts are not acceptable for proof of payments.
  • Once we have verification that there are no liens on the property and there is clear title, we move to close.
  • Closings are usually completed by overnight carrier. We send you the final documents for your signature as well as notarization.
  • Once we receive all the correct documents as well as the original, deed of trust, mortgage, note, etc. we will wire your funds to a bank you provide us. The process usually happens in around 3 weeks if there are no glitches. One glitch that occurs more often than others is the seller doesn’t have the original note, deed of trust, mortgage depending on the state. We then must have a “certified copy” created. In many states this isn’t a big deal but in some it can be quite difficult where it can add significantly to the closing period.

I hope this process information was helpful.

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