Real estate promissory notes are agreements two parties agree upon to pay a certain amount of money over time. These notes are secured by property as collateral until the note is paid for in full.
Notes are considered performing when the note is being paid on-time or non-performing when the borrower stops payment on the note. If the borrower restarts payment on the note again, the note is now considered re-performing.
The allure of note buying is that the owner of the note doesn’t have the problems that a typical landlord often faces such as the calls or complaints from the tenant renter.
With the note or investment collateralized by the property, this reduces the risk in this type of investment compared to possibly other investments in your portfolio.
Another benefit of note buying is that the monthly return is predictable. The return is based on the interest rate of the loan you invest in and does not fluctuate over time. This is the opposite of investing in the stock market where returns can vary from day to day. If you are tired of watching your investments swing up and down, then maybe you should diversify your portfolio by buying notes.
HIghland Capital Solutions works nationwide which allows investors to spread out their risk when note buying while holding long-term assets to build your wealth for retirement.
If you are interested in learning more about buying or selling notes with us, please contact us using the form on this page.