What is a
privately held mortage note?
A privately held mortgage note is an official promissory note that a buyer
gives a seller in exchange for a piece of property or real estate.
Industry insiders oftern refer to privately held mortgage notes as private
mortgage notes, real estate notes, or real estate paper.
How is a
privately held mortgage note generated?
A privately held mortgage note is generated when a real estate owner sells
a piece of property using owner financing. These transactions often
include the phrase "for sell by owner." Owner financing
means the property seller, rather than a bank or other lending
institution, finances the sale of the real estate. During the
transaction, the owner accepts a downpayment from the buyer and a mortgage
promissory note for the rest. The note is structured as a contract
that includes an interest rate to be paid back over an agreed upon amount
of time. A majority of the time, the note is paid back through a
series of monthly payments.
What type of
mortgage notes do you purchase?
UFS is interested in the following categories of private mortgage notes:
||Residential Notes: Residential Notes are created by the
sale of residential properties, including houses, townhouses,
condominiums, and one-to-four family rental units.
||Commercial Notes: Commercial Notes originate from the
sale of any type of commercial (business) property, including
retail structures, offices and office buildings, apartments
composed of more than four family units, and industrial
||Vacant Land Notes: Vacant Land Notes result from the
sale of developed or undeveloped land, or land not designated
for a specific use, such as farmland or waste storage.
This category does not include land that has been improved for
development and building.
How does a typical note
purchase scenario work?
UFS begins by collecting information about the mortgage note via our
Application For Mortgage Note Purchasing, which can be download
or completed online. The
application and any supporting documentation, as defined in the
application, are then evaluated for purchase. If the note is deemed
ready for purchase, a quote will be submitted back to the note
owner. Once the quote is accepted by the note owner, a Mortgage Note
Purchase Agreement is completed by both parties, along with an Assignment
of Mortgage Purchase Agreement.
As a note holder, you may terminate discussions with UFS or negotiate
the process or quote at any time. You are not obligated to accept
the quote or proceed with the transaction at any point. Only when
the Mortgage Note Purchase Agreement and Assignment of Mortgage Purchase
Agreement are agreed upon and signed by both parties is the transaction
official. UFS does not charge a fee for any services rendered prior
to completion of the transaction.
How do I get started?
You may contact one of our account specialists using our online
inquiry form or via phone at 832.236.6570. If you prefer to proceed
without contacting us directly, you may download our application or
complete the online application, both of which contain instructions for
submitting the completed document to UFS. Any fields left blank on
the application can be completed during your initial consultation with UFS
Is there a fee?
There is no fee for the initial process of completing the application,
obtaining necessary documents related to the note, and delivering a quote
for the note. You, as the note owner, may complete all portions of
the purchasing process, including receiving a quote with no fees or
obligation to sell the note.
Do I have to sell all of my note?
No, absolutely not. You, as the note owner, may sell as much
or as little of the note as you desire. You may choose to sell
only a couple of the monthly payments or a couple of years worth of
payments. Furthermore, you have the choice to sell a series of
the next expected monthly payments or monthly payments from future
years of the mortgage note. In either case, you will receive
cash right now for those payments you choose to sell.
Why should I sell my mortgage
By selling your mortgage note, you will achieve the following
||Cash: You will receive immediate cash for
your note. That cash can be used to payoff debts, pay taxes,
travel or take vacation, purchase a new car or boat, invest in a new
house or piece of property, invest in a new business, or simply to
take advantage of another investment opportunity. The uses are
limitless; afterall, it is cash.
||More Time: The buyer assumes the burden
of collecting payments on the note; therefore, the seller is free of
||Reduce Risk: The risk of non-payment by a
payor or tenant is eliminated. You receive cash now for the
note and no longer must worry about delinquent payments.
Will selling my note effect my
current payor / tenant?
No. In fact, selling your note to a commercial business, such as an
investment or funding company, may make things easier for your payor /
tenant, as the payor may be able to participate in direct withdraw
payments or online billing through their respective banking
institution. In any case, the payor simply changes the name to whom
the payment is written and the address to which it is mailed.
Can I sell payments from
multiple note at one time?
Yes, all or portions of multiple notes may be sold at
once. Simply complete and submit an application for each
note, and UFS will coordinate the process to include
simultaneous purchase of all notes involved. While
completing the applications, simply note in the note description
section that you are interested in a quote that spans multiple
notes. Please contact us with
further questions regarding multiple note transactions.