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Sell a Mortgage Note

Often one will sell his home on a land contract or mortgage note with the full expectation that he is willing to take monthly payments over the entire term of the agreement. However, life can be unpredictable, and things over time change. One’s health changes or an opportunity comes along where a larger sum of cash is required to take advantage of said situation. When one ponders the situation he or she suddenly realize that they have a mortgage note or land contract that they hold and if only they could tap the current value in a lump sum, they can pursue their dream, ambition or opportunity.

In these situations the question that will often come to mind is, can I sell my mortgage note for cash. There is a ready market of buyers for these relatively marketable mortgage instruments, and the process can be easy if your work with the right company. If you have a land contract that you wish to sell, the buyer will in most cases want it converted to a mortgage note. This is to give added protection to the person buying the note.

A good note buyer has a backlog of investors on a waiting list waiting to be notified as soon as a marketable note is presented to the note buyer for review, so selling a mortgage note is very doable. The most secure note is a note that is backed with a single family residential property, with the mortgagor living in the property. Some of the things that a note buyer will look for when buying a note is the type of property, if the contract was written correctly, the credit worthiness of the payer, and if there is a balloon payment built into the agreement.

If you want to sell a mortgage note, one of the biggest problems that will make a note hard to market is having documentation that the payer of the note has good credit. When the note was written, there should have been a stipulation for the mortgagor to provide a credit report and documentation of a stable income source. Those that are self-employed sometime have a hard time getting approved for a land contract as it is hard to verify the actual income and in case of default, the mortgagee may have a hard time finding assets to attach. Wages are difficult to attach even if one is able to get a judgment, as the owner of the business is also the employee and it is easy for the owner to arrange it so that he shows no income.