Greg Dixon talks with Ivan Tererro, The Note Doctor, to discuss returns on mortgage notes.
They start off by explaining what a note is, with Ivan illustrating it as an IOU or a promise to pay a debt, backed by a hard asset such as a house.
They also differentiate between non-performing and performing notes, noting that non-performing notes are ones that have not been paid on time for over 90 days, while performing notes are ones that have been paid on time consistently. Ivan highlights that with hard work and commitment, investing in non-performing notes can yield high returns despite the initial challenges.
Key Points
- A note is simply a promise to pay a debt, in this case it’s backed by a hard asset like a house.
- Performing notes are consistently paid on time, generating about 8% to 12% annual return.
- Non-performing notes are not paid on time but can yield high returns up to 40%-50% if well managed.
- Ivan’s approach to non-performing notes is to understand the borrower’s situation and reach a payment agreement that suits both parties.
- Ivan and his team are both buying and selling notes, interested parties can reach out to them.
Learn more at https://www.thenotedoctor.com/
