You’re determined to pay down debt as quickly as possible, so you’ve been racking your brain to come up with ways to expedite the process. One simple way to pay down debt, minimize risk, and achieve financial peace of mind is to sell your mortgage note to a qualified buyer. With that said, we’ll take a detailed look at the risks of carrying a mortgage note, the rewards of selling one, trading principle for financial security and more.
The Risks of Carrying a Mortgage Note
There’s some measure of risk involved in every financial choice we make. Some decisions are certainly riskier than others. You may not want to hear this as a mortgage note carrier, but you put yourself in a position of great risk for very little reward by allowing a buyer to pay you in monthly installments.
For starters, anything could happen to put your mortgage payment in jeopardy. People get sick and lose their jobs all the time. Companies downsize and move their operations overseas or to Third World countries to save money on labor. Your current mortgage holder might seem rock-solid on paper, but one unlucky break could leave this family or investor without income and struggling to pay their bills.
Property values are not nearly as stable as they once were prior to the crash in 2008.
If the housing market crash taught us anything, it’s that there are no safe investments anymore. The real estate market used to be stable, and there’s certainly more stability at this time, but you never know when it’s going to come crashing down around us once again.
Let’s move on to the other side of the equation.
The Rewards of Selling a Mortgage Note
On the opposite side of the coin, you can gain financial rewards and peace of mind by selling a mortgage note. First of all, you eliminate the uncertainty of future note payments. As mentioned earlier, people experience setbacks all the time. A property that is more than affordable right now could become a huge financial burden in the future due to unexpected circumstances. Second, you eliminate a potential court battle if the time comes to foreclose on the property.
To protect your investment, you’ll have to pay high-priced legal fees, court fees, and waste too much valuable time that should be used for more enjoyable experiences like spending time with family and friends.
Third, you’ll create greater cash flow than you may already have right now.
Having cash on hand certainly helps provide greater peace of mind. You’ll have money available in the event of unforeseen circumstances that could otherwise rock your world and make life miserable for you and your loved ones.
Trading Principal for Financial Security
In most cases, you will have to trade some of your mortgage principal when selling a mortgage note.
According to financial solutions experts Aegis One:
“You may believe that your note can be sold for a lump sum payment equal to its current principal balance. With the help of a note broker, you may be able to find a private mortgage investor willing to pay you the face (“par”) value of your note, but par value purchases a rare.”
Using Your Mortgage Note Proceeds to Pay down Debt
According to AmerinoteXchange.com, the fastest-growing commercial and residential mortgage buyer in the US:
“… the chances of successfully reaching your financial goals and securing the highest payout become greatly increased when using the right direct mortgage note buyer and/or mortgage note funding source.”
Ultimately, this means you’ll receive more cash for your mortgage note. And you can use the proceeds to pay down burdensome debts including credit cards, car payments, student loans, back taxes, and more.
Wendy is a super-connector with Towering SEO and Youth Noise NJ who helps businesses find their audience online through outreach, partnerships, and networking. He frequently writes about the latest advancements in digital marketing and focuses his efforts on developing customized blogger outreach plans depending on the industry and competition.