What Are Note Buyers?

By Ezmeralda Lee

  • Overview

    Note buyers are individuals or companies who pay cash for the transfer of a person's note. Most note buyers will purchase any kind of note: house note, mortgage note, car note, lottery tickets and much more. The benefit to the note owner is that they get immediate cash. The benefit to the note buyer is that they receive the interest that is attached to the note. Note buyers are especially popular during recessions or other hard economic times.
  • Identification

    There are many different kinds of note buyers. Usually a note buyer has a website or some other kind of advertising. Sometimes note buyers work in conjunction with other financial services such as loans or cash advances. When the note buyer takes over the note, the note now belongs to that company. The previous owner of the note sells it and receives a cash settlement. Sometimes the note buyers pay the full amount, while other times they pay slightly less than what the note is worth.
  • Function

    The purpose of note buyers is to give people a chance to sell their assets, notes and insurance policies to receive instant cash. This is useful for both sides. The person who owned the note and needs money is able to sell the note and get the money immediately. The note buyer is able to use the note to bring in interest on the note, or maybe even sell the note to someone else for a higher price.

  • Benefits

    The main benefit of note buyers is that when a person needs money quickly, they are able to sell sources of income that do not yet give them money so they can receive the money all at once. This is generally used for mortgages, life insurance, contest winnings and land notes.
  • Misconceptions

    A note buyer is not the same thing as a cash advance store. A note buyer does not have any dealings with the previous owner of the note after it's purchased. The customer is selling the future payments for money now. The note buyer owns the note after the transaction, and the customer gives up any rights to the note and to any physical assets attached to the note. If you are interested in receiving money this way, make sure they never want to own the note again.
  • Expert Insight

    Note buyers have a unique business. The greatest advantage of the note buying business is definitely on the note buyer's side. Becoming a note buyer is a great business to get into if you have the money to purchase other people's notes. With proper management, note buyers can make a large profit off the notes they purchase. When the notes finally pay out, the note buyer comes out ahead. Always have a lawyer review legal issues that have to be dealt with in the transfer of notes.
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