Discounted Notes — Buying

💡 Unlike being a landlord, there are no "tenants, toilets, or termites" to manage.💰 Higher Yields: Buying at a discount creates an automatic gain in equity and a higher ROI than traditional bonds.🛡️ Asset Security: Your investment is backed by a physical asset that can be liquidated if necessary. Risks to Watch For

Borrowers are making regular payments. These offer lower risk and steady, immediate cash flow.

If the property value drops below your investment amount, your "security" is weakened. buying discounted notes

The loan is secured by real estate, providing a safety net if the borrower stops paying. Types of Notes

First position notes are paid first in a foreclosure, while "second" or junior notes are riskier but often cheaper. Key Benefits 💡 Unlike being a landlord, there are no

AI responses may include mistakes. For financial advice, consult a professional. Learn more Should You Only Buy First Position Notes? - BiggerPockets

You collect interest on the full $100,000 balance, significantly increasing your effective yield. If the property value drops below your investment

When a lender (like a bank or private seller) wants to free up cash, they may sell their mortgage notes at a discount.