Getting Started in the Cash Flow Business

If you have opened a newspaper or turned on the news in the last year or two, you may very well have noticed that there is a level of financial uncertainty relative to the mortgage industry. Many enterprising individuals remember that historically every downturn in the economy leads to an upturn and that the change in general financial climate can lead entrepreneurs to new economic opportunities. Market changes provide entrepreneurial opportunity, be it in a bear or a bull market, a strengthening or weakening national economy. Being entrepreneurial yourself, you may very well be looking at the mortgage industry and trying to discern if there is a chance you can find some way to leverage your skills and ability to generate new revenue streams.
Does this sound like you? If so, you may want to look at a unique niche of the mortgage industry by working with privately held cash flows. What's a privately held cash flow? In a nutshell, most homes are bought using borrowed money from banks and other financial institutions. This is not the only place financing can be found, however. Often, private individuals will actually carry the financing of the sale. In this scenario the home buyer then makes scheduled payments to this private party instead of to the bank.
The private note holder then holds “paper” which is secured by the property purchased. Once the agreed upon terms have been met, that “paper holder” relinquishes all rights to the property and the buyer of the home will own the home free and clear. The system can work well for everyone involved. The buyer of the house may get into a home they would not have qualified for under bank requirements due to poor credit or some other reason. The person financing the home will receive payments over a period of time that could equal out to a much higher dollar amount than would have been possible when receiving the sales price value all up front.
This particular private financing is becoming more common as financial institutions tighten lending requirements while recovering from the current sub-prime debacle. How can you get involved? If you have very deep pockets, you may become interested in purchasing the right to hold the financing. While banks often bundle portfolios of mortgages together and sell them to other banks, similar things occur on a daily basis in private financing as well. Note holders may sell their notes for the same reasons banks do, to generate liquid for reinvestment
Purchasing liens secured by property can be a costly enterprise, but even people with shallow pockets can find potential gain in the private cash flow industry. There are note holders that may want or need to sell their notes, and there are potential investors looking for an opportunity. How to bridge the distances and understanding between the parties? A unique group of people who call themselves “note finders.” Note finders find, inform and potentially bring together note holders and note buyers, and receive a fee for their service. The finder helps the holder get liquid capital today, while helping the buyer to invest where the buyer sees benefit. A note finder helps people and gets paid for it, while performing in a unique and lucrative niche in the mortgage industry. Not a bad place to find gain in an economy that is suffering over all