Can I Sell the Note from the Property I Sold and Carried Financing On

The answer is absolutely Maybe!
Nine of ten times people will answer this question with a resounding Yes. However it is possible that you have created a note which nobody is willing to purchase. This factor may prevent you from selling your owner carry, or seller financed real estate note. Many times the seller of a property will prioritize the buyers needs over their own in order to make the sale. If you have any intention of possibly selling your note at a later date you must create a note that will be attractive to a buyer when this time comes.
Allowing your buyer to purchase with no money down, taking their word on their credit rating and not verifying this for yourself, offering a super low interest rate, or creating complicated terms are factors your buyer may enjoy but can also prevent you from selling your note or force you into taking a very steep discount. When you are selling property and you are planning to carry some of the financing you must take control of structuring the deal, especially if you are planning to sell this note. Keep in mind that when you sell a note you will take a discount off of the the face value of the note.
Why must you take a discount? The investors who buy mortgage notes or trust deeds are purchasing risk. Therefore buying at a discounted price counters the amount of risk they are taking on with the purchase of your note. There is no way around you taking a discount, however if you have created a quality note to sell you can limit the amount of this discount.

5 Key Factors to Creating a Quality Note, and Why:
   1)  Get the highest interest rate your buyer is willing to pay.
        Reason: Investors expect a high yield when purchasing a note. This is part of their built in risk reduction.
       A higher interest rate will allow for a smaller discount in order to build in the necessary security required
       to purchase your note.
Tip: Start by requesting 10% or more and negotiate from there.
   2)  Know Your Buyers Credit Score:
        Reason: Your buyers ability to pay is a key factor in determining risk. Bad credit means a buyer who has
       difficulty meeting their financial obligations and therefore creates a high risk of default on the loan. Note
       buyers are not interested in owning property, if they were they would be real estate investors not note
       investors.Foreclosure is an expensive an complicated process note investors would prefer to avoid.
Tip: It is your right to ask for and review your potential buyers credit report and score, and it is strongly recommended you do so. Never take their word for it.
   3) Always Get a Cash Down Payment: 
        Reason: The amount of Equity in a property is also a key factor in determining risk as this creates a
        safety net for the note buyer. A lesser amount of equity will require a bigger discount in order to create
        a false equity that lowers risk.
Tip: When you sell your note the sale price of the property will be considered as current market value, therefore the larger the down payment you get the greater amount of equity you will create. A 20% down payment will create the 80% LTV (Loan to Value) that note investors prefer, especially if you are planning to sell your note right away.
   4) Season Your Note for Higher Return:
       Reason: While a real estate or mortgage note can be sold right away the longer you hold onto it the better
       you will make out on the overall deal. Collecting payments for a minimum 3 months will increase the
       attractiveness of your note. Obviously the more the better but also consider that during the time you hold
       your note you will be collecting monthly payments which are mostly interest and very little principle.
Tip:By holding your note for a year or two the principle balance your note purchase price is based on will reduce very little. While at the same time your note will become safer allowing for a smaller discount at the time of sale. When you then calculate the down payment received, the note sale price, and the total amount
collected in monthly payments over this time period you may actually increase your original sale and the
overall net into your pocket.
    5) Create Simple and Short Terms:
        Reason: Crazy terms create high risk. Longer terms mean a longer period of time for the buyer to collect their money--increased risk.
Tip: Fully amortized loans are best. When shortening the term of payoff to 20 years or even less you increase the monthly payment and reduce overall risk. Balloon payments for sooner payoff are good, but do not accompany them with interest only payments, amortize it out.

If you are having a tough time trying to sell a property in these difficult times you may want to consider offering seller financing to help you attract a whole new group of potential buyers. At PSR Note-Ability are always willing to help people with deal structuring and note creation so they that they may later sell their mortgage. We do not charge for this assistance and only ask you bring your note to us for a price quote when the time comes.

Visit the website at www.psrnote-ability.com or call me direct at 530-318-2662. I answer my own phone and will happy to assist you any way I can. Even if you just a question, my door is always open.