Where Do You Find Good Notes To Buy?

[Daniel Williams]

I’ve been learning about mortgage notes for the last several months but find it difficult to find where to purchase any. 

Paperstac is okay, and I’ve subscribed to a few note selling companies/people and will receive a tape of some being sold, but these rarely have any good ones. 

Curious if anyone has had experience with any reliable and consistent sellers or brokers of notes. 

Thanks,

Daniel

[Don Konipol]

Quote from @Daniel Williams:

I’ve been learning about mortgage notes for the last several months but find it difficult to find where to purchase any. 

Paperstac is okay, and I’ve subscribed to a few note selling companies/people and will receive a tape of some being sold, but these rarely have any good ones. 

Curious if anyone has had experience with any reliable and consistent sellers or brokers of notes. 

Thanks,

Daniel

The note business is in an economic situation right now where the risk adjusted return is below most other investments. So you can either get the same or better return (risk adjusted) investing in a mortgage fund, pool or REIT, or try to find that "needle in a haystack" outlier.

Paying full loan balance for a note is not where the real ROI is; it's purchasing a note at significant discount to remaining loan balance and "working" the note. We deal only in the commercial space with a minimum loan size of $500 - $700k and max $5 million, and are able to close on maybe one a year. The rest of our $50 million AUM is invested in notes we originate - where we accept an ROI that's increasingly making me wonder if it's the best use of our funds.

what you’re up against is professionals in the business that tend to “stretch” because they feel they need to keep their business going even if the ROI is too low. So assets get bid up beyond a “reasonable” price; that’s why you can’t easily find the deals you’re looking for.