Note value calculator
What's my note worth?
I make two offers on every note: one to buy the whole thing, and one to buy just the next few years of payments. Enter your numbers to see both in under a minute.
Your two offers
Enter your numbers
Fill in the balance, rate, and payment. You'll see what I'd pay for the whole note, and for part of it.
This is a ballpark, not an offer. A real quote is free.
How I figure your two offers
No secret formula. Here's what goes into every offer I make:
- The payments. I price the payments you have left, based on the rate, the balance, and how many years are left.
- The property. I never pay more than 70% of what the property is worth. That cushion protects both of us if something goes wrong.
- Closing costs. A property value check (about $150), a title search ($250 to $600), and attorney fees (about $500) come out of the offer. You'll see each one listed. No surprise fees at closing.
Then I give you two numbers. Option 1 buys the whole note, and you're done. Option 2 buys the next few years of payments, and then the note comes back to you. See how a partial sale works.
Why notes sell for less than the balance
Your note pays you over many years. A buyer pays you today. The buyer needs a return for waiting and for taking the risk that the payer stops paying.
Here's the key. Most notes carry a rate somewhere around 5% to 10%. Buyers usually need more than that. The bigger that gap, the bigger the discount.
Quick rule: a higher rate, a shorter term, and a payer with a lot of money down all mean more cash for you.
Rough price ranges
| Note type | What it looks like | Rough price |
|---|---|---|
| Strong | 20%+ down, 9%+ rate, balloon within 5 years, a year or more of on-time payments, good credit | 85% to 90% of the balance |
| Typical | 10% to 20% down, average rate, 10 to 20 years left, steady payments | About 70% to 85% |
| Tough | Little or nothing down, low rate, 25 to 30 years left, or late payments | Often under 65% |
What raises your price
- Seasoning. Every month of on-time payments helps. A year or more helps a lot.
- Equity. A big down payment means the payer has a lot to lose.
- A payer who lives there. People fight hard to keep their home.
- A shorter term or a balloon. I get my money back sooner.
- Clean paperwork. Drawn up by an attorney or title company and recorded with the county.
- Good records. A clear payment history. A loan servicer is even better.
What lowers it
- Late or missed payments
- Little or no down payment
- Vacant land, or a property in rough shape
- Unpaid property taxes, or no insurance on the home
- Homemade documents, or a mortgage that was never recorded
None of these mean you can't sell. They change the price. Tell me up front and I'll factor it in.
Planning to sell later? Do this now.
- Keep a simple log of every payment: date and amount.
- Have payments go to a bank account, not cash.
- Make sure the payer keeps insurance and lists you on it.
- Check that the mortgage or land contract was recorded.