Here’s an example so you can see how it works in practice: Case Study: Note-on-Note Financing Asset: Non-performing note secured by a suburban retail center in TexasCollateral Value (BPO/Appraisal): $2,000,000Note Purchase Price: $500,000 (25% of collateral value)Summit Partner Lending Loan: $350,000 (70% of purchase price)Investor Cash In: $150,000Term: 6 months, interest-only, with 4-month reserve built inSecurity: Collateral assignment recorded against the deed of trust  Outcome: Investor only needed $150k instead of $500k.Capital freed up to acquire multiple notes instead of just one.If note paid off, our loan was repaid at closing through title.If foreclosure occurred, our lien converted into a deed of trust on the property.  

Here’s how it usually works in practice (which you’ve probably read about, but we see a lot):Investors buy a property in a market they believe in long-term and classify it properly for STR use.

Once your portfolio grows, or if you move into larger multifamily/commercial, that’s when an LLC (or series LLC) becomes more practical.

Hi @Oliver Searle-Barnes, I would make it more practical.

Jackie, thanks for breaking this down so clearly — not many folks are talking about note-on-note in a practical way.

My priority in design is rooted in practicality.

Not just for real estate but also for computer programming when I was in college.This was a matter of practicality as I had no other way to succeed. 

I still review IRR in my copy of Real Estate By The Numbers (the thing is like an investor's Bible 😂) but I haven't put it into practical use.

Ryan does a great job on his analysis, breaking it down in practical terms.

You justify your deceptive practices via holding an assumption "everyone else is doing it too".