by Gayle Ramsdell
The cash flow/note industry has been around for many, many years and, contrary to popular belief, it is necessary to have a certain level of intelligence, patience, more patience and education in the field to persevere. Education is necessary to allow you to move forward in this industry.
We have had occasion of late to deal with many new people to the industry whose level of note education leads them to believe that the money that goes into their pockets comes first and foremost. Almost every newbie that has contacted our office in the has asked for an agreement to make sure they get their almighty dollar. When I ask them if they have an agreement with the note seller, they are surprised that they should have one. When asked about due diligence on their package, they seem to think I’m speaking a foreign language.
The first class I took on the note industry was from a gentleman named Mike Meeker in Orlando back in the late 80’s. One of the best lessons, among many that he taught, was that you have to learn to crawl before you can walk, walk before you can jog, and jog before you can fly. That is posted in my office to remind me not to get ahead of myself in an industry that is constantly changing.
What I see and hear from new people is that they want to take off flying before they know how to crawl. They want to protect themselves against the evils of those of us who have been in the industry by having contracts when the reality is they have nothing to sell.
People, go back to the basics. Educate yourself as to the needs of an investor, whether private or institutional. Learn how to run the calculator. Understand the document that you are asking someone to invest in. Know what “due diligence” is in your state.
Invest in classes that are given by sincere individuals that have been in the market to BUY notes, not SELL programs. Look at the classes given by people that buy notes and/or have been teaching for many years. They will show you how to find notes that perhaps others won’t. They won’t show you how to find notes that everyone else already has found and has shown me at least 4 times
in the same week.
There are many programs out there that are well worth their cost. But ask yourself these 6 basic questions:
When I finish the class:
1. Will I be able to understand what a note and mortgage is?
2. Will I know how to run a financial calculator when I leave — enough to make offers?
3. Will I understand what due diligence means?
4. Will I know how to put a complete package together for an investor?
5. Will I know how to have a conversation with someone that may be willing to sell a note?
6. Will I know what to do with the note once someone accepts an offer?
You spend your hard-earned money on education in the business, and you need to be able to make sure you start off on the right foot.
Look at this industry from an investor’s point of view. Then the money will come to you.
We look forward to helping new people in the industry, but not unless you can answer the questions above with “YES.” If you can’t, check your contract with the people you took the class from — and get your money back.
Gayle Ramsdell is the President of Franklin Note & Mortgage Company and a respected investor well-known and liked by everyone in the note industry. Contact her when you have a note to sell: e-mail franklin@netsync.net
RELATED STORY: https://papersourceonline.com/2716/more-on-russ-dalbey-winning-in-the-cash-flow-business/
Thank you for this timely questionaire. I’m getting back into the note finder business. I have been studying your “Complete Package” material. I will be certain I can answer all these and more before I get started looking for notes.
Thanks
thank for sharing, it’s good to do business with people who aren’t corrupted, take their time to inform & show people with patients in the note business how to be successful without stealing their hard earned money. I’m just trying this out, I’ve invested already close to over $1,500 dollars & havent made not one deal yet. but I’m learning & am a lot wiser than before. I love to help people but to use people & steal their money & use the fact that their struggling as an excuse for to spend what little they have left, it’s ashame & wrong. I’m very quite happy the way I am & if my situation changes, I’ll still be the same person as I was when I want successful because I know theses things are just material & there aren’t eternal rewards & I beleive in a living God. Money changes people but not me. I have learned so much & am still learning about the business & I ready don’t care about the profit that much, as long as I make just enough to get by day by day, in fact, I’m thinking of giving up the majority of the money to the note holder of my percentage just to show them that I really don’t care about theses things. If I make $3,500 , I give them an extra $1,500 of my share plus closing, just to keep the deals coming to me. I cam get buy, with 2 to 3 deals a month. I’ve been in this business for almost 6 months, & I havent done any deal yet & I’m learning through trials & errors. I’m very aware of con artist. Thanks for sharing….
Hi , I am in this to make mad money…I have over 20 years of industrial mortgage lending finance transactions in escrow, title, processing and underwriting…..I am willing to cross-train into another aspect of notes and lending….hopefully some of the same banking jargon I can still use to this venture…How do I check the due diligence for the state that I am doing the notes transactions in? Do I have to have a license to sell a note to an investor in certain states? I am not buying yet, just brokering to investors that may want a nice deal on a note. I have a knack for packaging the deals to make them look and smell sweet, but need to know what documents I need to have for the states that I am servicing.