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INVESTTHIS - Scott Bower EPISODE 132, 17th December 2020
Deep Dive into the $26B+ Note Investing Market
00:00:00 01:07:45

Deep Dive into the $26B+ Note Investing Market

Get out your notepad because we will dive deep into note investing, from the hard numbers to real-world scenarios of the many ways to make money investing in notes. From how to handle a default due to foreclosure and still make money, to a property that doubles in value and your return, as the lender, will be. Nick goes into great detail as he starts with the note's market and goes through all the scenarios and the financials for each one. Basically, this podcast tells you everything you need to know to either up your note investing game or just get started. 

Real estate is a cyclical business, property values go up and down, but it doesn't matter what the market is doing when you invest in notes. The other benefit of note investing is there are multiple ways to make money, and you can help people who can't get a traditional loan become homeowners. And, let's not even get started about the #1 benefit of not having to deal with tenant issues. 


You are going to learn from the best, as my guest Nick Legamaro, also known as "The Note Guy," has been note investing for almost 20 years. He focuses on providing his clients with high-yield, low-risk, turn-key real estate investment notes, secured with carefully selected residential properties throughout the United States. He is here to help you become a successful note investor.


  • What's changed since COVID: The foreclosures will be hitting Forbearance (pushed payment back in time) in January 2021 (may change with new administration) 


Banks always get paid because they are in the business of control, not owning 


  • You can be the bank and what that means. 
  • Why Scott likes investing in notes
  • The leverage you have when you are the bank 
  • Today's environment: End of 2020, the market has gone bananas. 
  • As each year goes by, fewer and fewer people fit the pretty buyer box for traditional lenders.
  • Seller financing
  • Very few investments allow for predictable returns and cash flow, except for mortgages. 
  • Holding notes vs. holding a property
  • Amortization on a note
  • Going through a real-world notes deal.
  • Two types of financing: traditional and seller carry-back note seller financing
  • Understanding the $26B seller note market 
  • The properties you can't get traditional mortgages on
  • Seller finance usage from 2009 to the present 
  • Creating notes buying property, fixing it, finding the buyer, and creating seller financing as the lender on the property. 
  • Understanding how a note deal works when the property doubles in value
  • Why it doesn't matter if a buyer defaults on a loan
  • How to keep your asset and resell it if the borrower defaults due to foreclosure 


At the end of the day, you can't predict the future, but you can mitigate your risk


  • Understanding the most significant challenges and risk for note buyers (fraud)
  • Doing your due diligence on finding and securing a clean note 
  • $26B seller financing notes are made through mom and pop investors 
  • Why you don't have to do traditional underwriting for 3 mortgage notes
  • What does a mortgage servicer do for you, and why it's important
  • Answering FAQs on note investing 
  • How to leverage LTV (loan to value) so you and the borrower can succeed
  • Understanding Investment to value (loan to cost)
  • Why borrowers will pay a 10% interest rate to a private lender
  • Why big banks are going to make it tougher to get a traditional loan


Using a mortgage servicer as a third-party verification which validates your word


  • Notes are tradeable and liquid and how to sell for cash at a maximum value
  • Understanding the foreclosure process, which is different for different states
  • The benefits of note investing and the multiple ways you can make money
  • Using your retirement money to invest in notes and have more when you retire
  • Scott talks about one of his note deals
  • How Nick helps people create note deals 


Get in Touch with Nick To Learn More About Note Investing

USA Note Pro

nick@usanotepro.com