The 9 Risks of Mortgage Note Investing

I get a lot of questions from folks considering coming on board as a funding partner on one my mortgage note or property deals about the potential risks involved. I like getting these questions from folks because it shows that they are thinking things through and taking real estate investing seriously.

All investing has risk and it's important to be able to identify as many of the potential traps as possible before doing your first (or next) deal. The task then is to figure out how to best mitigate these hazards.

Some risks can be avoided completely through solid due diligence practices prior to closing on the deal or making the investment, such as an appraisal, title search, property inspection, etc. Other risks can be minimized by implementing solid systems and business practices while the deal is ongoing. Think property management, loan servicing, routine property visits etc.? Other risks can never be completely avoided or even properly identified, (anyone remember the last global pandemic?), but we can still be smart and formulate investing strategies to lessen the impact that these unknowns could have on our pocket books. Diversifying your investments geographically and by the type of investment can help.

In this video I brainstormed 9 of the potential risks of investing in mortgage notes and how we mitigate these risks for long-term success and maximum profitability.

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Note Deal in Memphis, TN

I am currently seeking a funding partner to purchase this non-performing mortgage note in Memphis, TN.

Here's what you need to know:

• The house is worth $160,000
• I have an agreement to buy the mortgage note (not the property) for $20,000
• The borrower owes $51,000 on their mortgage note. They have not been paying for many years (non-performing note)
• The plan is to buy the note, start the foreclosure process and sell off the property at the foreclosure auction to collect on the $51,000 principle balance owing on the mortgage note.

Here's what I am offering a funding partner:

• Investment amount required - $23,000 USD
• Interest rate offered: 10% (paid at the completion of the foreclosure)
• Expected timeline: 8 months (Tennessee is a non-judicial foreclosure state that typically allows a lender to foreclose in 6 months)
• I will pay a full 12-months of interest even if the deal is completed in under a year.

Contact me if interested.

Click Here to Schedule a Call

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Free Real Estate & Note Investing Strategy Session!

If you are looking for ways to get your lazy money working for you, real estate and mortgage notes might be a great strategy. Especially right now!

Reach out to me for a free Real Estate & Note Investing Strategy Session by hitting the link below.

Schedule a Call with Cal Ewing

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