Privately Held Real Estate Notes Are Secure!

With so much shifty business going on around us, it sometimes can be hard to tell which business transactions are safe and secure and which ones are not. One of the great things about a privately held real estate note transaction, is the security of the transaction itself.

A real estate note secures the holder of the note with a promise to pay.

A privately held real estate has all the information contained therein about the various terms involving how the obligation is to be paid including; payment amount, interest rate, when the payment is due, the date when the note is to be fully satisfied and other terms and conditions involving the transaction. For instance, some notes may have what is called a "due on sale" clause which means the buyer of the property must pay off the note before he or she may sell the property, unless they have permission in writing that they may otherwise do so.

The note is secured by the real estate described, so should the buyer become delinquent in there payments, the seller has the right to claim what is owed by way of the property. This of course is secured by a mortgage contract or trust deed. There is some amount of uncertainty in the event of default, but the note holder normally has the right to take action. Again the note is a legally binding contract between both parties and must be followed according to its terms and conditions therein.

The payor is known as the mortgagor and is obligated to make payments by sending them to the individual whose address is located on the note. Sometimes notes are paid off early because the payor will fix credit problems or eliminate other obligations, allowing them to refinance the property. In this situation the note holder would normally always be paid the full balance of the note in full. Note holders usually never really wanted the note in the first place, so they are usually very cooperative when it comes to being paid their money early!

Despite the security of the note, (and the possibility of being paid off early), there are many other reasons a note holder may still want to sell, even if things are going smoothly and according to plan. Lack of confidence is one. The person holding the note may be in fear that something may happen to cause the payor to stop making payments. Even though they can take action, many note holders don't really know what to do in the event of a default. I once spoke to a gentlemen who held a note to a very valuable piece of property in Los Angeles who had not been paid on it for a year! The process can be trying for some, but it is not as difficult as some may think.

The laws in each state vary to some degree, so its a good idea to seek some type of legal counsel before hand, but the fact still remains, privately held real estate notes are secured by the real estate listed on them, and legal action is almost always available if one will just take it. Real estate is property that almost always holds some value, and securing a sale with a privately held real estate note, is still a viable way to satisfy both the seller and the buyer when those situations are deemed fit.

The Author is the owner of C.J.F. & Associates. If you want to sell your privately held real estate note, structured settlement, or an annuity, call 1-800-908-9312 or go to http://www.cash4you123.com/ for more information.