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How Much Will You Pay For My Note?

March 14, 2010 by Tracy Z 2 Comments

If you buy or broker notes, you know pricing is the first thing sellers ask when looking to cash-out their payments from a seller carry back. Discover what sellers are really asking and the best way to answer the “What’s Your Discount” question.

It’s natural for sellers to want to know the amount of money they will receive to sell future payments on a contract or mortgage. After all, it is the need for cash that made them make the call in the first place.

But if you listen closely, you will realize they are asking something beyond just the bottom line number. Sellers want to know:

Will you pay me a competitive price?

Are you trying to take advantage of me?

Will you treat me fairly?

This means the answer needs to accomplish several things:

  1. Reassure the seller;
  2. Help the seller understand why pricing varies;
  3. Establish a friendly yet professional relationship; and
  4. Set the stage to obtain enough information to provide a quote.

Of course the simplest answer to:

“What’s Your Discount?”

would be

“It depends!”

But be careful – what you say next is very important. Here’s the standard script we use to both reassure and answer the seller’s question.

“How much we pay really depends on your note. Each transaction is unique so we look to 5 key factors for pricing.

These include the type of property, the buyer’s down payment and credit rating, how long the buyer has been paying you, and the terms of your note like interest and payment amount. An average note will demand 75 to 95 cents on the dollar depending on the items mentioned.

If you have a few minutes we can go over the details of your individual deal. This helps us calculate the accurate fair market value of your payments rather than just a ballpark estimate. This of course is at no cost or obligation to you. Do you have a few minutes now to answer some simple questions about the property you sold?”

We then take the time to ask them questions about the transaction to gather enough information to complete the intake form or quote request worksheet. If possible, we also obtain a copy of the note, mortgage (deed of trust, or contract), and settlement statement. We can then provide an accurate quote subject to standard due diligence.

However you decide to answer the discount question, just be sure to address the seller’s real underlying question, “Will you treat me fairly?”

How To Calculate Cash FlowsWant to run purchase options, yields, and partials like a pro? Check out our How To Calculate Mortgage Notes Training for over 60 step by step videos!

Filed Under: Note Brokers Tagged With: discount real estate notes, learn cash flow notes, owner financing payments, sell mortgage note, seller carry back

About Tracy Z

Tracy combines her knowledge of real estate notes with the power of marketing online to help grow your business! She can be reached at Tracy@NoteInvestor.com or by calling 1-888-999-7905.

Reader Interactions

Comments

  1. Tom McGovern says

    March 22, 2010 at 3:55 pm

    Trazy I have purchased your product of note buyers and was satisfied

    Can I still purchase your february offer of the notehandbook downloaded for $37.50?

    Thanks
    Tom

    Reply
    • TracyZ says

      March 22, 2010 at 4:40 pm

      Hello Tom,

      We have had several requests to extend the February offer and are happy to say we will honor the special through March 2010.

      Once the order is placed the special bonus items will be sent via email.

      For more details visit: https://noteinvestor.com/featured/looking-for-notes-in-all-the-wrong-places/

      All the best,

      Tracy Z. Rewey

      Reply

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I also understand that I can revoke my consent and that I have the right to be forgotten. If I revoke my consent you will stop collecting or processing my personal data. I understand that if I revoke my consent, you may be unable to provide contracted products or services to me, and I can not hold you responsible for that.

Likewise, if I properly request to be forgotten, you will delete the data you have for me, or make it inaccessible. I also understand that if there is a dispute regarding my personal data, I can contact someone who is responsible for handling data-related concerns. If we are unable to resolve any issue, you will provide an independent service to arbitrate a resolution. If I have any questions regarding my rights or privacy, I can contact the email address provided.

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