Unlike a real estate mortgage note, a Business Note is usually secured by the business itself (rather than real estate), and all the inventory, equipment and assets owned by the business. Typically, we work with clients who have sold a business and received a substantial down payment. They have carried back a loan in the form of a Business Note, secured by the business and, usually, personally guaranteed by the payor (or business Buyer), and who are receiving regular monthly payments on the loan.
There are only three major investors nationwide that buy Business Notes to keep for their own portfolios, and they consistently pay the highest prices for the notes they purchase. We work directly with all three – our job is to negotiate with these sources to get the best deal possible for your note!
While we can review any note for possible purchase. However, the ideal note from an investor point of view – a note that will bring the highest purchase price – will be structured as follows:
20% - 30%+ Down Payment
10% - 14% Interest Rate
Maximum of 60 Month Term
Minimum of 3 Months Seasoning (i.e. at least 3 payments received)
Well Secured . . . Personally Guaranteed
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