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  3. Note Brokering

Note Brokering

Professional note brokers connect investors and sellers in the real estate notes market to facilitate transactions.

Note Brokering

Professional note brokers connect investors and sellers in the real estate notes market to facilitate transactions. They also manage post-closing responsibilities.

Many fraudulent websites promote these exchanges. But the notes on these sites are not always legit. Unethical companies quote one price and then lower it later. This is called “bait and switch.” It’s illegal.


Note brokering is a lucrative opportunity for those who want to earn income in the cash flow industry. It provides a flexible work schedule and a low start-up cost. It also allows you to earn while you learn and build residual income.

A professional note broker is an intermediary between a note seller and a note investor. In this role, you find people who want to sell their notes and then help them connect with buyers. You earn a commission on each transaction. There are many forms of promissory notes that can be brokered, including real estate and business notes.

The benefits of note brokering include being able to earn commissions on successful transactions; developing relationships with private investors; and staying up-to-date on regulatory requirements and industry trends. In addition, note brokers must be able to structure deals and close transactions, as well as handle documentation related to transactions involving notes.

Education and Training Requirements

As a relatively new form of investment, professional note brokers must complete training programs to become familiar with the laws and regulations in their jurisdictions. Additionally, they must have the ability to find buyers or sellers of notes, structure deals and close transactions. This includes drafting contracts and agreements for transactions involving notes, managing post closing responsibilities related to transactions that involve notes, and providing ongoing support after closing if needed.

Some seminar promoters claim that they have created a certification program similar to that of a Certified Cash Flow Consultant, which is bogus. In reality, these companies often offer a list of "note investors" or note buyers they expect their graduates to call for potential deals. The problem is that these note buyers are not the real deal and they end up wasting everyone's time.

To be a successful note broker, it is important to understand how to use online platforms, develop relationships with private investors and institutions and to network at note investor conferences and seminars. In addition, using a tool such as bank prospector, which allows you to identify with just a few clicks which banks have mortgage notes for sale, can eliminate hours, days or even weeks of tedious searching.

Licensing Requirements

Depending on the state in which you plan to operate, professional note brokers may be required to meet licensing requirements. Some states require that candidates submit biographical and professional information as well as complete educational courses related to real estate finance and investments. Other requirements may include a background check and a surety bond.

In addition to meeting licensing requirements, note brokers must also keep up-to-date on industry trends and regulations. Keeping up with these changes helps them provide quality service to their clients and help them find the best deals on notes.

One important thing to remember before taking a note brokering course or buying a book on the subject is to check out any companies offering such training with the Better Business Bureau. If there are numerous complaints against a company, it's likely that the claims of quick and easy profits are not accurate. This is particularly true for infomercial note buyer programs that are offered online.

Post Closing Responsibilities

A note broker serves as a go-between for business owners who need additional cash flow and investors looking for innovative ways to invest their funds. Professional note brokers must be able to effectively communicate with both parties and provide them with the tools they need to close successful transactions.

One of the responsibilities that professional note brokers must manage is staying up to date on industry trends and regulations. This can include being familiar with local zoning laws and understanding federal banking regulations.

It is also important that note brokers be able to handle the paperwork related to transactions involving notes. They must be able to draft contracts and agreements that will protect all parties involved in the transaction. It is also vital that they be able to answer questions from clients regarding their transactions and help them navigate any problems that may arise. For example, a real estate note buyer may discover after closing that there are leaks or drainage issues on the property that they are buying that weren’t disclosed.

Emmett Whitson
Emmett Whitson

Unapologetic coffee geek. Typical web advocate. Lifelong communicator. Proud twitter enthusiast. Friendly bacon buff. Proud internet lover.

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