holding note

I have sold one of my houses and got a $42,000.00 note. The guy from the mortgage company told me he has an investor that would like to buy the note for $25,000.00. I want to know if that is a good price to sell my note??? should I ask for more???

The answer is, “It depends.”

What’s the maturity date of the note? What’s the interest rate? Fixed or variable? What’s the loan to value? Is the borrower making payments on time? Does the borrower have good credit and cash flow?

If you need the cash now for some reason but the note his high quality, you may not need to sell all or part of it. You might be able to pledge the note as collateral for a loan from a bank.

You need to tell us the details of the $42,000 note. What is the term, what is the monthly payment, what is the interest rate, is there a balloon payment due etc. Only then can we compare the present value of your note with the $25,000 offer on the table.

:cool YES there neds to be more information !!! or no one can make a good answer! SO many people do not understand this you have to give the whole story on the note AS well if it is a new note this will change the amount you can get as there are not many who will look at anew note ! AND then you have the credit score of the buyer this makes a big deal on things

The main thing is note investors want to get the best interest and cash flow possible from the note. To determine that you have to consider the Principal Balance, Interest Rate, Length of amortization and if there are any special terms on the loan - like balloon payments or rate adjustments.

Also, it matters if the note is seasoned (the borrower has a record of timely payments) the LTV of the underlying property, position of the note (1st/2nd/etc) as well as the specific details fo the property (rental/owner occupied/condo/apartment/etc)

Take all of those things together and then you can make some decisions about whether the offer for your note is good.