In this edition of my blog, I want to focus on ways to find real estate notes to buy. Even in this real estate market where home inventory is low, most of us know ways to find property for sale. We know we can drive through a neighborhood we like and look for real estate signs in yards that say for sale…. or we know that we can online and use a search engine to find homes for sale in a community or neighborhood. Of course, you can also talk to a licensed realtor in your market and they will glad to offer their assistance.
It is not quite as easy to find real estate notes for sale. Recently, I was contacted by a young man who is discovering that fact. He has tried to find real estate notes to buy, but has not had much success. Let me share with you in this blog post four ways that you can find real estate notes to buy. In some cases, these notes will be for sale; in other cases, these notes might not be for sale but they are held by a private lender. It may surprise you to know that most real estate notes in the United States are not owned by large companies, but are owned by what call “mom and pop” investors. Anotherwords, most real estate notes are owned by an individual or couple who decided for some reason to seller finance one or two properties. If that be the case, how can you buy note holders who have real estate notes they want to sell or that are for sale?
Here are four ways to find real estate notes to buy:
1. Online sites that have real estate notes for sale- There are web sites where they list notes for sale. There certainly are not as many web sites that have notes for sale, but here are a few that I look at on occasion: www.notesdirect.com , www.paperstac.com … www.prereo.com . Some of the notes for sale might be from individuals or “mom and pop” investors, and some might be for sale by companies. Check them out. Some have more information about the note for sale than others.
2. Craigslist and Facebook marketplace- These sites have been around for some time, and are a way that one can buy or sell all sorts of things. While I do not recall that I have ever seen a real estate note for sale on them, you can search for real estate that is for sale where the real estate owner offers owner financing or seller financing. Search these sites for sites for real estate being offered for sale with owner financing. Once you find real estate with owner financing, contact the sellers to see if they might be interested to selling the real estate note once they sell the property. You might also see if the real estate sellers have another property they seller financed and if they would be interested in selling the real estate note for that property.
3. Worn-out real estate landlords- Most everyone who has ever been a landlord and rented a home to someone for several years or several decades can tell “war stories” about being a landlord- tenants that left a home in horrendous condition… renters that did not pay their rent in a timely fashion or did not pay at all… or the late night calls to do some repair. Go through a neighborhood… a newspaper… Facebook marketplace… or Craigslist and find homes for rent. Then, call the landlords and ask not to buy their home but if they might be interested in selling the home either to you or seller financing the home to someone else. If the landlord has owned the home for many years, there can be tax advantages to selling the home via owner financing because they can spread the capital gain over a period of time while they get passive income without trash, tenants, and broken toilets.
4. Real estate meetings- If your community has a local real estate investor meeting, attend and get to know the fellow attendees. As you get to know people, you not only will build your network but you probably will discover someone who might have a real estate for sale or are going to create a real estate note for sale.
These are 4 ways to find real estate notes for sale. Best wishes to you in your search and in all your real estate investing pursuits.-- R.L:Wall
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