Held Business Notes
A privately held mortgage note or real estate note is a promissory note
a buyer of real estate property gives to the seller in exchange for
ownership interest in that property. Owner financing has become an established
and accepted practice in real estate financing. It can be an attractive
and secure investment, with good returns, and has much less volatility
than the stock market.
When a seller provides owner financing it gives the buyer and seller
much more flexibility in structuring a loan, and eliminates the need
for the buyer to go through the hassles of bank qualification.
Types of Mortgage Notes:
Residential Notes Notes that
are created buy the sale of residential property, including single-family
homes, townhouses, condominiums, and one-to-four family rental units.
Commercial Notes Notes created
from the sale of any type of commercial property, including retail,
apartments, office and industrial property.
Vacant Land Notes Notes created
by the sale of developed or undeveloped land. The Funding Source Network
can assist in the sale of private mortgage notes, portfolios of residential
or commercial mortgage notes and can also arrange funding at closing,
or also known as a simultaneous closing.
Business Notes The
Funding Source Network represents funding sources that buy business
notes as part of their investment portfolios. Business notes are promissory
notes secured by the business. These notes are created when a business
owner sells a business using owner financing. Investing in business
notes is usually a riskier investment than other types of cash flows,
so funding sources normally expect higher yields when funding this type
Seven out of ten businesses are sold using this method of financing.
It is very difficult to obtain a bank loan to buy a business, because
of the high failure rate. Also, most businesses do not own enough assets
or collateral to secure a bank loan. Under these circumstances, business
owners have no choice, but to owner finance a portion of the sale if
they want to sell their business.
Selling a business note or a portion of the business note can provide
cash to the former business owner to meet his or her cash flow needs.
Many options are available on structuring this type of transaction from
selling all, or part of the note; you choose the solution that best
meets your requirements.
The Funding Source Network today at (916) 515-0039!
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