One of the biggest pitfalls of note buying occurs within the first three minutes of your conversation with the note seller. Your answer can make or break your deal in a matter of seconds and yet, even experienced note buyers are ruffled by it.
“How much of a discount do you take?” is, hands down, one of the most frequently asked questions that you’ll hear as a note buyer.
You must remember, whether you are buying notes or selling notes to an investor, there is no “standard” discount. It all depends on the note itself, the borrower’s equity in the property, the type of real estate securing the note, your personal investment goals, and plenty of other factors. All things considered, you might need a steep discount, none at all, or anything in-between.
That’s why I analyze every note that comes across my desk on an individual basis. It’s the only way to give the seller an accurate quote. Usually, the more I know about a note, the more I can offer the seller! In turn, if I ever want to resell the note, the investor will offer me more for it.
I hope you’re starting to see why there is no standard discount on notes. So how do you answer the one question sellers always ask before you’ve had a chance to fully evaluate the note? In this short video, I tell you exactly what to say to the note seller, so you don’t miss out on deals and profits that should be yours. Check it out!
Donna Bauer
The Original NoteBuyer®
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