Quoting Cash Flow Notes

When it comes to quoting and buying mortgage notes there are basically two camps of note brokers.

One camp takes the “Quote on the Fly” approach, while the other has the “No Note, No Quote” mentality. Read more

How to Negotiate Cash Flow Notes

One of the more popular questions, after “How do I find notes?” is “How do I negotiate with a note holder?”

Since the cash flow business affords consultants the ability to determine their own fee, many new note brokers feel challenged on how to present an offer. These 5 tips should help you be that much closer to closing the deal! Read more

Top 5 Ways to Buy Mortgage Notes

One of the things that make buying and selling notes so appealing is the multitude of ways an investor can purchase a note.

Frankly, you are limited only by your imagination. Well, maybe imagination and reaching a desired yield.

Here is a quick look at calculating the cash flow business that even those with math phobias will like.

The Top 5 Ways to Buy Cash Flow Notes

1. FULL – A full is just that. Buying the entire note.

If the seller has 322 payments remaining, the investor purchases all 322. The full purchase is the most popular way to buy mortgage notes.

Even though it may not be the best choice for a seller, many sellers just want to be completely done with the note.

2. PARTIAL – Anytime an investor purchases something other than a Full it’s referred to as a “Partial.”

Typically when someone uses the term “Partial” we are talking about purchasing the next immediate “X” Number of Payments. This can be any number of payments.

The most common partial purchases are 60 months, 120 months, and 180 months.

If the investor purchases the next 60 payments, the promissory note reverts back to the seller on payment 61. The seller, at their discretion, may choose to sell more payments or keep the remaining payments.

3. PAYMENTS ONLY – This type of partial purchase involves a balloon mortgage note where the seller is due a large balloon payment at the end.

For example, the note holder is to receive 120 more monthly payments and then a balloon payment of $50,000.

“Payments only” would be when the investor purchases just the remaining 120 monthly payments but none of the balloon payment. The seller of the note would retain future possession of the balloon.

4. SPLIT BALLOON – Very much like the “payments only” option except in this case the investor purchases all of the monthly payments (120) and a portion of the balloon.

For example, the investor purchases all the remaining 120 payments and $30,000 of the balloon payment.

This would leave the seller the remaining $20,000 due of the balloon payment.

The seller and investor have effectively “split” the balloon ($30,000 to the investor, $20,000 to the note holder).

5. SPLIT PAYMENTS – In this type of partial, the investor purchases a portion of each monthly payment.

It is typically reserved for when the seller of the note is receiving a sizeable amount each month (although it really could be implanted at any time).

For example, let’s say the note holder is due 145 payments of $2,500.00 each month.

The investor may elect to purchase $1,750 of each month. This would leave the remaining $750.00 each month for the seller of the note.

Typically the payer mails the full $2,500 each month to the investor and then the note investor forwards the $750 to the seller. This avoids confusion among the payer of the note as well as helps the investor make sure the note is being paid in full each month.

The “amount” of each monthly payment that is purchased is completely up to the agreement of the investor and seller. It just needs to be worth the extra handling efforts.

MAKING THE CHOICE

As you can see, there’s more than one way to buy mortgage notes. Matter of fact, there may just be literally hundreds of ways to purchase notes since many of the methods can be used in combination with each other (including Reverse and Split Disbursement partials)

As long as the deal can fit into the best financial calculator, there is a mathematical way to purchase the note.

So which method is best?

The best method is dictated by the needs of the note seller and how best to meet that need while still protecting the yield and exposure requirements of the investor.

How Much Money Will I Make in the Cash Flow Business?

 

 

 

 

 

 

 

It’s a fair question.

We find it’s the most popular with someone just starting out with cash flow notes. It’s also the most difficult to answer.

Nobody wants to just hear, “Well, that depends.” So here are Read more

Note Broker Marketing – Don’t Forget to Keep in Touch

People forget…plain and simple.

Hopefully not your family or close friends, but when it comes to business associates, they forget. It is your ability to “remind” them (in a subtle way) about who you are and what you do that gets to be a bit tricky (and the key to getting future business!)

Whether you are trying to keep in touch with a potential note seller or simply a referral source, how you approach these people can be an art. You don’t want to be annoying, but you want them to think of you first when the need arises.

So how do you do it?

Depending on the amount of people you need to touch base with, you might just pick up the phone and call them. I know, strange idea in the fast moving technology world, but it can be effective.

If you are going to go the calling route, it is usually best to keep it brief (you don’t want them avoiding your call in the future). Something as simple as just “letting you our company is here if you need our services” might just be all you need to do.

If you have numerous potential clients, phone calls may prove to be a bit overwhelming. Then what?

Personally, I prefer email updates in the form of a “newsletter.”

First off, it is important to remember that the updates should be informational in nature – not just a constant “pitch” getting them to do business with you. It is OK to “sell” in your eletters – particularly if you have some sort of “deal” going on at the time…just not all the time. Nobody likes to be “sold” over and over again.

I like email because it is easy and very efficient.

We use a company called Aweber (this email comes from using their system). They provide numerous ways to stay in touch with my customers and provide them continuous value (without breaking the bank).

Whether you use Aweber, another company, or try to manually send from your own computer – you want to continue to “remind” people you are out there. Someday they will most likely need your service and the constant value and information you have been sending them will not go unnoticed.

When was the last time you contacted your potential clients and/or customers? In this recovering market, now just might be the best time.

3 Ways To Make Money and Earn Fees in the Cash Flow Business!

Many people have heard about the cash flow industry but don’t really know how the average person can profit from it. There are basically three methods for handling the fees paid to cash flow brokers or consultants, as follows:

1. Referral Fee
2. Establish Your Own Fee
3. Set Commission Fee

Referral Fee

Pros: Very Little Paperwork/Time
Cons: Typically smaller commissions
Cash Flows: Most cash flows can be handled on a referral basis

The Referral Fee structure is the easiest, particularly if you already have a full time job or have limited extra hours in the day.

With the Referral Fee structure you simply find a deal and refer it on to a single Funder or Master Consultant that accepts referrals. Read more

Three Big Secrets to an Online Cash Flow Business

Here is the real deal: Most Cash Flow Consultants DO NOT have a strong online business.

You probably know the Internet is the place to be with your cash flow business. It is open 24/7 and it can work tirelessly providing you leads and getting your name out there. You may even have a website already in place.

Chances are, if you are like most cash flow consultants, you have little presence, no presence, or horrible presence. The latter just might be the worse.

There is nothing worse than building a web page, launching it, and seeing nothing happen. Where is the traffic? Where are the leads (and consequently, the deals)?

The good news is there something you can do about it!

Although I could write an entire book about what is wrong with some sites, here are the top three things that can improve your web presence and build you more contacts right away.

1. Does the site look unprofessional? - This is just a fancy way to ask if the site is ugly. I got it, you wanted to use pink or show a picture of your granddaughter at Disney World. Go get your own personal blog and put that stuff there. If you are trying to convey you can handle financial transactions, leave the flowers and Hello Kitty pictures at home.

Searching for a professional looking website for cheap? Check out the templates provided by StudioPress. Their themes run on a WordPress blog platform (which is free). I purchased the Pro Plus All Theme package and it has paid for itself 100 times over! Sign up for StudioPress Here.

2. Do you have too many cash flows? – You and I both know we have the ability to handle many different types of cash flows, including real estate notes, factoring invoices, structured settlements, and the list goes on. Your client is only interested if we can handle their specific cash flow or need.

If I put an advertisement in the paper that said, “I mow lawns and clean pools” you might give me a call. If your website is the equivalent of, “I mow lawns, clean pools, fix cars, and perform plastic surgery” you have too much info.

Consider having a different site for each cash flow you work with (see why I said “developer package” in #1). Don’t worry about the cost. I use HostiCan – providing unlimited websites for one hosting price! Sign up for HostiCan Here.

3. Are you keeping in touch? – If you are not collecting names on the Internet and emailing useful information on a regular basis (but not too often) you are missing deals.

I use Aweber. In addition to managing your database, Aweber can split test email campaigns using different sign up forms.

Aweber is a very powerful tool that goes way beyond name collection. They also have a ton of helpful videos. Sign up Here.

Having an online cash flow business can be a very rewarding and profitable venture. But you must conduct yourself professionally and use the right tools. It took me many years to get a handle on the Internet, and many more to find the best tools. Hopefully you will find these resources as useful as I have in building your cash flow business online.

Which Note Broker Are You – Traditional or Online?

Ask someone that has been in the Cash Flow Industry for more than 15 years about changes in the industry and you will likely get two different answers.

One group will suggest that, with the invention of the Internet, the industry has “evolved.” The other group may suggest that, with the recent downturn in the economy, the industry has come full circle.

Both groups would be correct although they Read more

Top 7 Benefits of Working in the Cash Flow Business

You may have heard a little about the cash flow industry in magazines, on television, or from a friend. You may be wondering if it is something right for you to pursue.

Here are the top 7 benefits of working in the cash flow industry (in no particular order).

1. Work When You Want – Although working in the cash flow industry should be treated as a business, it is a flexible one. You set your hours. Are you a morning person? Ta Da, you get to work mornings! Are you a night person? Ta Da, you get to work more during the evenings. Perhaps you want to golf in the morning or pick the kids up from school in the afternoon – you just need to work around your own schedule and meet the needs of your customers.

2. Funders Are Very Helpful – Most of the work (I mean as much as 80%) is really spent “finding” deals. Once you have found a viable cash flow deal many Funders and Master Brokers will be glad to help you close the deal and handle most of the paperwork.

3. Work From Home – Over 90% of all cash flow professionals work from their homes. This not only saves money, it also provides you some flexibility. Like when the cable repair person will only give you a window of 10:00am – 4:00pm to come by (no taking the day off work)! Read more

How to Find Private Mortgage Notes

So you have completed some sort of educational training to learn how to buy or broker notes in the cash flow business. You know, a live training, a series of CDs, or a home study course.

If you own the popular Personal Profit Series: Notes then you already have the proven marketing methods and materials you need. If not, you might be left wondering how to find private mortgage notes to broker or purchase for your own account.

Well, finding notes really is the biggest part of the business. There are plenty of funders and industry providers that can assist you in closing a deal, but first you have to find a “buyable deal.” Read more

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