Investing In Notes
If you’re looking for a safe investment for your hard-earned money but are unhappy with the poor returns that 401k, savings, CDs, bonds and money market accounts are earning you are not alone! Today’s stock and mutual fund markets are wildly unpredictable. While the potential for good returns exist in the market, it is not without substantial risk to both principal, as well as future earnings.
Investing in mortgage notes (sometimes referred to simply as “notes” or “paper”) is safer, more predictable, and yields much higher returns on average than any of the previously mentioned investment vehicles. They allow you to become a private lender with total control over your investment. It is secured by a 1st lien on the property, affording you numerous ways to exit safety and profitably, with returns on your capital investment typically ranging from 12-15% or higher.
Smart investors are putting their capital into the paper to control, acquire and flip real estate. As a private lender owning mortgage notes, you can enjoy high, stable returns by investing in notes that are backed by property. You can get excellent returns without the hassles of managing any property. This is an ideal instrument for people who desire stable, monthly cash flow from their investment. Monthly returns over 1% per month are not uncommon.
Platinum Ventures buys and sells performing, re-performing and non-performing real estate notes to produce above-average, safe and consistent returns for its own portfolio and well as to other private investors. We source individual and/or pools of mortgage notes ranging in cost from as little as $5,000, to $100,000 or more. These notes provide monthly returns for our private investors and are secured by a first lien against the underlying property. The lien “collateralizes” and stabilizes the investment, limiting your downside risk.
Imagine being in control of your own investment that works harder for you! All of this, AND your investment is doing its part to help stabilize the economy by assisting American family households maintain their homes whenever possible. It is a win-win.
There are two types of Real Estate Notes:
- Non-Performing Notes (NPNs)
- Performing Notes
Non-Performing Notes (NPNs)
Sometimes referred to as “Defaulted Notes”, a non-performing note is a mortgage loan where the borrower has not made his or her scheduled payments for at least 90 days.
A nonperforming loan is either in default or close to being in default. Platinum Ventures invests in NPNs where the borrower has not made payments for a minimum of 1 year, typically longer.
This allows us to acquire the debt (the actual note itself) as a substantial discount and work with the borrower using one of the five specific exist strategies to either get the investment re-performing or acquire the asset. It is because of this substantial discount that we reduce our investment risk to nearly zero.
Investing in a non-performing note generally has a time horizon of 18-24 months, and typically returns between 12-30% to the investor depending upon the exit strategy employed.
A performing note is a mortgage loan where the borrower is making their payment every month, in accordance with the agreed-upon original or modified loan terms.
For those investors who want consistent monthly cash flow with higher returns, investing in performing notes is a good option.
Investing in a performing note is designed to be longer-term, offering monthly cash-flow, principal safety (since it is backed by a 1st position lien on the property), and averaging 8-15% returns each month for the investor.