A mortgage note (also known as a real estate lien note) is a promissory note associated with a specified mortgage loan; it is a written promise to repay a specified sum of money plus interest at a specified rate and length of time to fulfill the promise. A mortgage note is proof of a debt or a lien on a piece of property. The property may be a home or it may be a piece of raw land, without any buildings on it.
If you are interested in selling a mortgage note that you hold on a property, it is something you can do on your own, with the help of a professional note broker. To sell mortgage notes, you must first put your mortgage notes in the hands of someone capable of selling them. There are some steps to follow for selling a mortgage notes. I would like to share these points with you.
First step is to find a licensed mortgage broker. In California you can easily find mortgage lender. To find a buyer for a first mortgage note; you may wish to find a licensed mortgage broker. The broker must have a license in the state where the property is located. A mortgage broker acts as a matchmaker or liaison between the buyer and seller of the note. Because mortgage brokers have a pool of business from which to choose, it is a much easier way to find a note buyer than trying to go it alone.
Second step is to negotiate the terms of the note sale. Tell the mortgage broker the amount of the note, the terms and conditions for the note. This may include the interest rate on the note and how many years remains on the mortgage note. One of two things may occur. The mortgage broker may purchase the note from you and eventually sell it to a buyer, or if he has an interested buyer, the broker may broker a deal between you and the buyer. California mortgage broker will do this for you.
Third step is to sign the sale agreement. To transfer ownership of the mortgage note, as the seller, you must sign a sale agreement with the buyer. The sale agreement is a legal agreement, which the mortgage broker can prepare on your behalf. The details in the contract include the note amount, term and conditions of the sale. For the agreement to be legal, the buyer and seller of the note must sign it.
Last step is to establish an escrow account with the broker. Set up an escrow account with the broker. This account is where the money transactions take place between you and the buyer. The buyer deposits the money for purchasing the note into the escrow account. The note broker fee is paid out of the escrow account and then the remainder of the sales money is distributed to you as the seller of the note.