How to make money with Note Investing!
Click Here for the audio only version on the Lady Landlords Podcast
Being a Landlord isn't for everyone. But, what I love about Real Estate Investing is there is something for everyone!
Have you ever considered Note buying?
A few month's ago, I did a workshop on Syndications as an alternative for a passive investment that didn't involve answering tenant calls and dealing with the headaches landlords do. While definitely not passive, note buying provides you with an opportunity to also escape the day to day management of rental properties. There are many parallels between buying notes and buying rentals actually. They both involve setting your buying criteria, networking, and knowing your numbers. You also get the cash flow like rentals and the possibility of a big pay day similar to doing a flip!
Here's the scoop on how it works:
What is a note:
A note is literally just a document that shows there is a promise to pay for something. For example, your mortgage is a note. Note buying is the idea of you becoming the bank and collecting monthly payments and interest along the way.
How to find them:
Just like everything else in Real Estate, networking is the answer here. When looking to buy a rental property, you would let others know what criteria you are looking for. This is no different. You would want to speak with lenders- local banks, credit unions, hard money lenders- and let them know what you are willing to buy. Then, stay in contact with them until they have it to offer up!
How to make money with them:
Buy low, sell high. Seems simple, right? The caveat is that you need to buy notes with all cash, but remember, there are price points for all budgets. The idea is that if you can buy the note for less than what the outstanding debt and asset is worth, then you can look to deploy one of the multiple exit strategies to get your pay day. Most notably, once you buy the note, you then can collect that monthly payment for cash flow or you can "flip" the note and sell it for more than what you paid for it.
Tune into today's Lady Landlords Podcast episode to learn more about notes and get a special offer on an upcoming workshop!