History Of The Real Estate Cash Flow Industry.

By Christopher John

What is the cash flow industry and where did it all begin? Lets take a quick look at the subject.

The process of a seller financing a real estate sales transaction has actually been around for hundreds of years. The seller helps the buyer purchase their property by self - financing and agreeing to accept deferred installment payments for all or a portion of the purchase price. The real estate is held as collateral, so the seller is secure in knowing that if the buyer should go into default, they are protected and have recourse. This is accomplished of course by way of trust deeds, land contracts, etc.

As long as there have been these owner financed deals, so have there been investors willing to buy them at a discounted price. Most sellers of property would have rather received full payment for the property to begin with, but in an effort to secure the sale, (thus helping the buyer with the purchase), they go ahead and accept the terms. Once the possibility emerges that they have the ability to receive cash for their note, many note holders are glad to liquidate their notes in order to have the ready cash on hand.

Although investors have always existed for privately held real estate notes, only in the past two or three decades have their been any real organized methods for moving the money from seller to investor, so before that sellers didn't have a lot of options available.

Real estate agents were the most common way for a seller to liquidate a privately held real estate note. Once  the real estate agents capital was exhausted for these transactions, they would bring in private investors as a way to try and keep the flow of their sales transactions going.

Late in the 70's the process of buying and selling notes started to catch on and even started showing up in mainstream real estate literature. Most of the transactions that were occurring at that time however were pretty much localized in particular areas. Metropolitan areas still proved rather scarce for sellers to liquidate their notes and the cash flow business still had a way to go to be considered mainstream. If a seller became desperately in need of cash and wanted to liquidate, they either came up empty handed or had to drastically discount their notes to make a sale.

Times have changed since those early days of buying and selling privately held real estate notes. There are numerous books available on the subject and even T.V. infomercials and seminars. People from all walks of life are dabbling in the business and savvy real estate agents now have the opportunity to make more money by offering the availability of liquidating notes to their note holding clientele. Instead of having to invest their own money, they simply refer the client and receive a commission for the referral.

This availability to help their clients cash out of a note can prove quite useful to business owners and clients alike in many ways, such as freeing up cash flow for other deals, helping transact deals where the buyer is short on credit and can't finance all of the sellers asking price, and the list goes on.

The buying and selling of privately held real estate notes has come a long way since those early days, and with today's economy as shaky as it is, it likely will continue growing and helping buyers and sellers complete their transactions, when alternative methods are unavailable.

The Author is the owner of C.J.F. & Associates. For assistance in selling a privately held real estate note, structured settlement, or annuity call 1-800-908-9312 or go to http://www.cash4you123.com/