Resolution Capital Management will occasionally release part of our inventory of performing notes in our portfolio. We do this to recapitalize our fund to purchase more distressed notes and reposition them into performing notes.
What is a “note?” In essence, its a promise to pay. In Real Estate, the note is secured by the mortgage or Deed of Trust, which is backed by the property as the collateral.
These are typically institutional paper, originated from a bank and sold to us on the secondary market. This means that the note and associated “paper” has been created and vetted by the bank’s legal staff before the borrower signs the documents. When we buy a distressed note, we keep the original note and mortgage in place and simply modify it to reposition the note for performance.
We offer three different types of performing notes:
Performing Notes, which the buyer is paying as agreed.
Re-Performing Notes, which went into default, and have worked it out to get the buyer paying again.
Note Parials, where you buy a fixed amount of monthly payments for a defined term.
We obtain the assets from the secondary market through our relationships with asset managers, brokers and other investors who have notes available. These properties are not on the market, rather, the current occupant typically wants to stay in the home, and is making the payments, or the terms have been adjusted so they are affordable.
Why Should You Consider Buying Real Estate Notes?
Owning performing or re-performing notes means steady, cash-flow until the note is paid off, or resold, without the hassles and costs of being the landlord. Any repairs are made by the buyer of the property; you are the bank. No swinging of hammers or paint brushes.
Owning non-performing notes based on the possibilities of making it re-performing by changing the terms to make it affordable to the buyer, getting a lump-sum cash payment of all arrears, or if needed, foreclose and sell for a profit.
Resolution Capital Management sells performing, re-performing, and note partials. No matter if you are interested in buying the entire note or just a part of the income stream, we have a constant pool to choose from. We help you diversify your risk by locating geographic areas that offer you attractive opportunities. You can also use a self directed traditional IRA for tax deferred growth, or a self-directed Roth IRA for tax free growth for you, or your children.
If you are tired of making 1% on a bank CD, or want off the stock market roller coaster, diversifying into notes backed by real estate makes a lot of sense. To find out more about buying a performing note or partial payments, please contact us by calling us at 360.850.1252 ext. 111 or complete the form on our Contact page.