Creative home sellers who offer seller financing to potential buyers can often sell their houses more quickly (and at a higher price) in a slow market.

While applying seller financing techniques isn't more difficult than traditional real estate sales, it is important to recognize that the buyers looking for seller financing represent a different target market than typical bank-financed customers.

Similarly, the process for obtaining a large cash payment for the seller after a note is created varies from the conventional real estate closing technique as well.

Fulfilling a Seller's Need for Cash

In some seller-financed real estate situations, the property owner may have an immediate need for more cash than what is available from the scheduled principal and interest payments. This situation often comes about when the seller needs to have enough money to use as a down payment for their next real estate purchase.

In order to quickly obtain a large proportion of the money due from the loan they just created, the seller could sell the monthly note payments to a buyer for a lump sum of cash. By locating someone willing to buy the note payments, the seller will have ready cash for a down payment or any other pressing financial need.

In order to streamline the seller finance sale situation, it is advisable to have potential buyers for the newly-created cash flow at the ready. A seller can start looking for buyers before the note is created, or even before a seller-financed buyer is "lined up". This way, the property seller could have a buyer for the payment stream ready to make the purchase as soon as the new private mortgage is created.

Using Note Finders...

In the secondary finance industry, a unique group of individuals exist who specialize in working with note buyers. These cash flow specialists - often known simply as "finders" - have a unique understanding of what most buyers are looking for. These finders are happy to work with agents and their clients. Many of them utilize online marketing and have Internet websites to facilitate the buyer location process. DJ Note Investing is your cash flow specialist!

The best of the bunch also look in the newspaper for property sellers offering financing, so sometimes a good finder will contact the seller if their property is advertised as FSBO. Finders specialize in helping property sellers locate buyers for secured notes.

Once in contact with a finder, the seller should explain the details of the situation. While note finders won’t be able to offer any legal advice or assist with the creation of a note, they are qualified to give general recommendations about what types of terms are attractive to note purchasers. Most importantly, note finders will be able to help locate a buyer for a newly-created cash flow.

Remember, these finders are not note brokers, meaning they will not "show" the seller's note to buyers or act as a representative. They will only pass the information along to someone who would be interested. Once a commitment to purchase the cash flow has been established, the buyer will step in and complete the deal.

When working with a property seller who needs a lump sum of cash immediately after selling their real estate, contacting a finder early in the process of creating a real estate note makes sense. By involving a qualified note finder BEFORE a note is created, the property seller can receive invaluable input about the payment characteristics that note buyers prefer.

Without this knowledge, the property could sell quickly with the creation of a new note, but the seller might end up collecting the payments long-term instead of being able to quickly "trade" the future payments for an upfront cash settlement. If the property seller needs a large amount of cash quickly, it makes sense to plan ahead for a buyer to purchase the cash flow and involve the services of a note finder.

Locating the Right Note Buyer

What is the best way to find the right note buyer? It’s as easy as contacting DJ Note Investing! We work with up to 35 different note buyers which allows us to get you the most amount of money for your monthly income payments.