What Exactly Is A Promissory Note?
Hi and thank you for visiting. I’m glad you’re here because today I’m going to start my tutorial series on mortgage notes and teach you everything you would ever need to know about real estate notes, starting with the answers to the question: What is a Promissory Note? .
If you’re here, you probably already know that I’m a professional mortgage note buyer but this tutorial series isn’t about me. Instead, it’s about you learning the ins and outs of mortgage notes in the hopes that when the time comes and you’re ready to create one, you create one of great value.
Because trust me, there are good and crappy mortgage notes out there. The last thing you want to do is create a bad note that has no value in the market.
To help you avoid that, my plan over the next several weeks is to update this blog with a new tutorial at least every 2 weeks coupled with a video as well for a better understanding of the material.
Thank you again for visiting Sell My Mortgage Note for Cash. Let’s get started. Here’s your first video with additional text below.
Tutorial Part 1
In today’s lesson we’re going to discuss some of the nuts and bolts of the mortgage note business. Just so you understand where you are right now, you are here because you are interested in selling a mortgage note. Perhaps you’re not even aware that you can sell a mortgage note.
If that’s true, consider yourself lucky because you are definitely in the right place if you are interested in selling a mortgage note.
Before we get too deep into the lessons, I think we need to first cover the basics. And that’s what I’m doing today with this sell my mortgage note for cash tutorial part 1 titled “Promissory Note, What Exactly is It?”
Let’s start here!
Did you know that The Promissory Note does five different things.
Defined properly, a promissory note is a written promise to pay a certain amount of money, and its payment is secured by some type of security instrument that becomes a lien on the real property.
In particular, the note specifies:
(1) the amount of the loan (principal);
(2) the interest rate (interest);
(3) the amount and frequency of payments (debt service);
(4) when the borrower must repay the principal (due date); and
(5) the penalties imposed if the borrower fails to timely pay or tender a payment (late charge) or decides to pay a portion or all of the principal prior to the due date (prepayment penalty).
Further, the promissory note identifies the person who makes the payments to you (the buyer of your property—the borrower) and the person who receives the payments (you). In a nutshell, that’s exactly what a promissory note is. Pretty simple really.
That’s it for now. Please look for my next sell my mortgage note for cash tutorial where I’ll reveal yet another important aspect of the mortgage note.
Here is investopedia’s definition of a Promissory Note. Pretty damn boring if I say so myself. Lol.
Thank you for visiting sell my mortgage note for cash.
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