This is the first question you need to ask any lender/funder you are working a note deal with. In the early days of my Note broker business I put an ad in a local Florida weekly paper. I had a few calls one of which was Mr. Cason he was an elderly man who needed to sell his note and he needed to sell it now. With dollar signs in my eyes, I found a lender online that stated they would buy this type of single family home note. I filled out all the paper work along with my quote sheet copy of deeds and I had a signed sealed and notarized fee agreement.
I got an offer of 150k on this note I offered Mr. Cason 148k he said the offer was a bit low but he agreed to do the deal. Now let me tell you I was already counting that commission, yes I know don't count your chickens before they hatch :) I picked up exactly what the lender/funder said they needed and I thought for sure I would get that first deal closed and be on my happy newbie way right to the bank. To make a long story short this lender/funder called back two weeks later saying they needed a few more docs which Mr. Cason and I promptly pulled together and faxed over to them with in the hour. Two weeks later Mr. Cason called me for an update so I called my Stuart lender/funder and they said they made a mistake the quote was too high they would now offer 143k, after a months of keeping the deal together now they throw a monkey wrench in the mix.
After talking to Mr. Cason I lowered my fee of course and he accepted the new offer of 142k. At this point I was just happy the deal was still on the right track. One week later Mr. Cason calls me and he is very angry, The new documents he received in the mail now say he will only get 130k I finally calmed him down and asked him to fax me the due diligence paper work. Upon receipt I see what the problem is my lender/funder is a broker not a lender and they are wanting 12k for their fee. At this point the deal fell apart.
This deal taught me so much about brokering notes. If you are a newbie with dollar signs in your eyes take a moment to be wary of brokers that pretend to be the lender. Pick up a copy of Noteworthy or the Papersource they have real Lenders listed. Most good lenders will do a bit of hand holding for the green note broker just starting out, you will just need to let them know your new to the paper chase. So the moral of the my short story is always ask new lenders " Are you a Note Buyer or A Note Broker"?
I got an offer of 150k on this note I offered Mr. Cason 148k he said the offer was a bit low but he agreed to do the deal. Now let me tell you I was already counting that commission, yes I know don't count your chickens before they hatch :) I picked up exactly what the lender/funder said they needed and I thought for sure I would get that first deal closed and be on my happy newbie way right to the bank. To make a long story short this lender/funder called back two weeks later saying they needed a few more docs which Mr. Cason and I promptly pulled together and faxed over to them with in the hour. Two weeks later Mr. Cason called me for an update so I called my Stuart lender/funder and they said they made a mistake the quote was too high they would now offer 143k, after a months of keeping the deal together now they throw a monkey wrench in the mix.
After talking to Mr. Cason I lowered my fee of course and he accepted the new offer of 142k. At this point I was just happy the deal was still on the right track. One week later Mr. Cason calls me and he is very angry, The new documents he received in the mail now say he will only get 130k I finally calmed him down and asked him to fax me the due diligence paper work. Upon receipt I see what the problem is my lender/funder is a broker not a lender and they are wanting 12k for their fee. At this point the deal fell apart.
This deal taught me so much about brokering notes. If you are a newbie with dollar signs in your eyes take a moment to be wary of brokers that pretend to be the lender. Pick up a copy of Noteworthy or the Papersource they have real Lenders listed. Most good lenders will do a bit of hand holding for the green note broker just starting out, you will just need to let them know your new to the paper chase. So the moral of the my short story is always ask new lenders " Are you a Note Buyer or A Note Broker"?
