7 Tips for Note Sellers – Maximize Your Payout on Performing Residential Notes

[Frances Cammack]

Hello,

If you're holding notes and thinking about selling, here are 7 practical tips I've learned from working both sides of these deals:

1. Document seasoning clearly – Buyers want 12+ months of clean pay history. Have servicer statements or payment ledgers ready (bank statements work too for private notes).
2. Get a fresh BPO or appraisal – "Solid equity" matters more than ever. Even conservative estimates showing LTV under 70% make deals move faster.
3. Know your note's interest rate weakness – If it's under 7%, expect deeper discounts vs. current market yields. Price accordingly or bundle multiple notes.
4. Understand servicer transfer costs – Some buyers cover this, others don't. Ask upfront—can add 1-2% to your net proceeds.
5. Time your sale around borrower payments – Sell right after a payment hits (not before). Recent "paid current" status eliminates underwriting questions.
6. Have borrower DTI ready – Buyers love DTIs under 40%. If you know rent/borrower income vs. PITI, that's gold.
7. Shop 2-3 buyers – Pricing varies wildly. Direct buyers like me (Eagle Flight) close in 7 days, but marketplace platforms sometimes beat pricing.