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LELEARNARN HOW HOW TOTO FIND,FIND, FUND && FLIPFLIP REALREAL ESTATE NO NOTESTES FORFOR HUGE PROFITS!PROFITS!

Note Flipper 1 LEARN HOW TO FIND, FUND AND FLIP NOTES FOR HUGE PROFITS!

Download The FREE Note Flipper Checklist Now! www.howtoflipnotes.com/checklist Contents

FOREWORD 2

INTRODUCTION 3

THE LIFE CYCLE OF A REAL ESTATE 6

THE BASICS OF NOTES 9

BECOMING A DEAL ARCHITECT 13

MAKING MONEY NOTES 21 FOREWORD

Eddie Speed is a legend. I’ve known Eddie and watched his for years, and every single time I’m with him.... I learn something new.

There’s a lot that sets Eddie apart from the pack. Not only is he brilliant and, hands down, one of the most well-versed entrepreneurs and real estate out there, but he took the time to focus on a very unique, very niche corner of the business—something many of us (myself included) overlooked: note investing and note flipping. While I’d heard the term “note” tossed around, I never fully understood what it meant or why I should care until I started working with Eddie. To say he opened my eyes to a whole new world of would be a massive understatement.

As you’ll discover, Eddie’s method is tremendous—fool-proof, easy to unpack and even easier to apply to your life and your business. The best part is that Eddie provides concrete next steps and a variety of ways to work with him and his billion-dollar business, ensuring you can learn the ropes while you generate meaningful, lasting wealth. Really, what more could you want?

Eddie is truly a revolutionary force in this business, and someone I value tremendously as a colleague, partner, confidante and friend. His work is unparalleled, his success is meteoric and his ability to break it all down so we can ALL benefit is like nothing I’ve ever seen before. As you’ll discover, Eddie’s methods open up endless doors and make the journey to success with note investing simple, straightforward and lucrative.

Good luck—but, if you follow Eddie’s method, I’m confident you won’t need it…

Matt Andrews Matt Adrews CEO, Real Estate Freedom

Note Flipper 2 INTRODUCTION

Chances are, when you think about “real estate investing” you think about something very specific. My guess is that your head goes right to those -flipping shows where experts and amateurs knock down a few walls on distressed , and make tons of money when their before-and- afters are complete. Maybe you envision something else—being a or even properties. These are all spot-on examples—they’re common, often lucrative and meaningful ways to profit as a real estate investor.

But what if I told you that there was another simple path to making MAJOR profits without the headaches and hassles that come with traditional real estate investing? I’m talking about a truly unique and untapped opportunity that many new or even expert investors don’t know much about. What’s that opportunity? Flipping real estate notes.

This path is powerful. By flipping notes, you can buy properties withno money down.

If you’ve been in the real estate investing business, you probably realize that very few “no capital needed” promises actually deliver. This one DOES. By following the simple strategies outlined in this guide, you’ll be able to create full-time income in your spare time without putting anything down.

No bull or hype. No hoops to jump through. No lofty expectations or sky-high demands. Most importantly, no money down.

In this guide, you’ll learn what note-flipping is, how it works and why it’s truly one of the best models for building your wealth. You’ll discover how to:

• Consistently grow your short- and long-term wealth by flipping notes • Become a powerhouse “Deal Architect” and mold deals into exactly what you need them to be • Find the very best notes that generate serious cash • Get 100% funding for your deals • Structure win-win deals to drive maximum profits for YOU...and much more!

I’ve been in this for the last three decades, and I’m ready to share with you my process for securing properties and increasing —literally, the process that’s made me millions.

So whether you’re a new investor just getting started or a seasoned pro, learning the art of note flipping will help get you on the path to a more lucrative future. All you have to do is read on and commit to taking action.

Are you with me? Good—now let’s do this. Eddie Speed Note Flipper 3 About Me

I know you’re probably wondering…who is this guy?

I’m Eddie Speed, and I’ve closed more than 40,000 owner-financed notes. In total, my team has done more than $3.5 billion in business transactions. I started buying note portfolios in the 1990s and focused predominantly on buying them in bulk—something lots of people talk about but few people actually do, let alone do well.

Over the years, I’ve taught thousands of people the amazing earning potential that comes by owning the note instead of the . I’ve shared my knowledge and market insights with many firms, active investors, would-be real estate titans and diverse individual clients who’ve wanted to learn the ins and outs of note investing so they can create financial freedom.

I myself didn’t follow a “traditional” path to real estate success and my own multi-billion dollar journey didn’t happen overnight. While I’ve been investing in notes for decades, I’m not some banker or real estate mogul by trade or training. I’m a family guy and—wait for it—a cowboy.

That’s right. Before real estate, I was literally out there in the rodeo circuit and working as a professional rancher. I took the job seriously, and I even became a world-champion roper. At the time, I couldn’t see doing anything else but being a cowboy. That is, I could see it until I no longer had a choice.

After falling from a horse and breaking my back, I was no longer able to live the wild and exciting life that comes with being a cowboy. Sure, I was able to still ride, but my career was over.

Note Flipper 4 Little did I know that the of one door would lead to the opening of another. My father- in-law took me under his wing and taught me all about note investing. He showed me how he personally bought and sold notes—and how he drove massive profits as a result. His personal process involved knocking on doors and going to country clubs, doctors’ offices and dentists’ offices to find anyone with money interested in investing. It may seem old-fashioned in today’s tech-driven society, but his techniques worked for him and they worked for me—the former cowboy from Mississippi.

Before he passed away, one of the most important things he taught me about the business is that it’s all about the experience. Sure, there’s money to be made in note investing, but it really comes down to the experiences with your family, the freedom you gain, and the lessons learned along the way.

As you’ll soon discover, this business is tremendous from a passive income perspective, which is one of the things I love. I run a huge business, but I’m a family man at my core. Because of the nature of this business, I can be there for my family and prioritize their wants and needs above everything else.

I’ve set up my business in a way where I don’t need to be in the weeds 24/7 to make money. I can lay the foundation and work through this very simple, straightforward process, generating revenue every step of the way. I don’t want to be buried in paperwork or constantly on the road or working around the clock. I want to live MY life on MY terms, with family time at the very center of it all. With note flipping, that’s my reality.

And I want it to be your reality. So dig in, commit and get it done. If you can do that, this business is for you.

Note Flipper 5 The Life Cycle of a Real Estate Investor

Before we get into notes specifically, let’s take a minute to talk about real estate investing as a whole. I suspect you have some image that springs to mind when you think about real estate investing. Maybe that image is anchored in your own experiences or maybe it’s simply anchored in what you’re heard, read or seen on TV. And chances are, that image is accurate. However, there’s a lot more than just that experience.

This is the growth of a real estate investor, broken down in a very simple, digestible way.

Let’s go through each stage in detail.

Note Flipper 6 THE LIFECYCLE OF A REAL ESTATE INVESTOR

Bird Dog First, you see the bird dog. Bird dogs are just getting started in the industry—they’re essentially deal hustlers. They find deals and turn those deals over to potential buyers because they often don’t have the money or the time to buy, rehab or even flip agreements to others. In my opinion, this is a solid way to get started. You learn the ropes, you learn what investors look for in deals and you start making valuable industry contacts. With that said,you won’t make a lot of money as a bird dog, and you may be limited in who you can work with and who you can’t. So it’s important to keep that in mind.

Wholesaler Next, there are wholesalers. They get deals under contract and flip those contracts to rehabbers, or other end buyers. They get paid an “” fee once the deal closes. Essentially, this a finder’s fee for identifying, qualifying and negotiating the deal. That saves the end buyer a lot of time and resources while still ensuring they get a great deal on a great property.

Rehabber Then, there are the fix-and-flippers—therehabbers . They do all the work. In my experience, this is where everyone thinks they need to be...until they’re here. Yes, you can make tens or even hundreds of thousands of dollars on a single flip, but you can also lose a tremendous amount of money if you don’t know what you’re doing or don’t time things exactly right. There are so many headaches that come with being a rehabber that I wouldn’t go down that road, especially not right now.

Landlord Next in line are the landlords. Landlords own rentals, multi-families and buildings, and they hang onto them for passive income. Every month, they collect rent and they get richer. Like rehabbing, there are tremendous headaches that come with this approach, from keeping properties full and receiving payments on time, to , rehab and repair work, local codes and regulations and more. In the beginning, it’s often hard to turn a substantial profit. Knowing what I know now, I often look at the 60 or so rentals I own and think, “These could have been notes if I’d structured them differently…” I especially think that when I’m getting angry tenant calls in the middle of the night, or when a unit sits empty a little too long…

Note Flipper 7 THE LIFECYCLE OF A REAL ESTATE INVESTOR

What do these four stages have in common?

In the immediate pre-recession days, all of these were good businesses. Inventory was cheap, and there was lots of it. People wanted to sell their properties, and they needed affordable places to live. If you could be part of the solution, then you could make a lot of money. Again, it’s all about timing, and in many ways, that timing is a thing of the past.

Deal Architect There’s a fifth bucket or role to consider—thedeal architect. The deal architect combines all of the things that feed into this holistic landscape.

As a deal architect, you’re going to take all of the skills you’ve developed in any one of these practices and kick things up to a completely different level. Instead of talking about what someone paid for a deal, we’re going to start talking about how the deal was structured. We’ll talk about how to look at and transact a deal so you can avoid being saddled with whatever the market hands you. We’ll talk about how to mold a deal and make it what it needs to be—what you want it to be—no matter what.

Becoming a Deal Architect

At the end of the day, a deal architect sees potential and opportunities when other investors and power players don’t. When you know how to structure a deal, you’re a true architect, and when you’re a true architect you can create a deal where others see nothing. If 10 people look at a single property and only YOU can see the true potential in it, you’ve suddenly eliminated the competition and created a very streamlined path to generating wealth. That path is also easy to replicate over and over again, so you can make more in even less time.

Over the next few sections, I’ll guide you through the process of becoming a deal architect and share the exact process I use to flip real estate notes and make serious cash in the process. For now, roll up your sleeves, grab a pen and be prepared to take action. If you are, there’s nothing stopping you from achieving meaningful, lasting wealth and financial freedom flipping notes.

Before we dive right in, let’s talk about what notes are and why they matter.

Note Flipper 8 The Basics of Notes

WHAT IS A NOTE?

The 50,000-foot overview is that many different things can constitute a “note.” A check is a note. Think about the structure of a check. It says “Pay to the order of,” with a blank space after. You fill in the payee’s name, you date it, and you fill in the amount owed or the amount to pay—for example, $1,000. After that, you spell it out “one thousand and xx/100 dollars.” Then, you sign it. Once you hand that check to the payee, they take it to their bank and immediately get $1,000. That’s a very basic, very common example of a note.

Then, there are the notes I’m talking about—the notes we’re going to buy. I buy notes that are payable over time. These notes come with their principal amount plus . At its simplest level, a note is a —which is a promise to pay. Through that lens, these notes are a bit more like mortgages. You agree to take on a mortgage and pay the bank or lender back the original principal plus interest. The specifies the balance, interest rate, and the time to pay the mortgage note off. However, the terms of mortgage notes can vary dramatically.

When investors buy in a note, they purchase the secured and become the lender, after which they are entitled to receive payments from the borrower. Generally speaking, note investors purchase notes at a discount to the remaining principal balance. Many people find it difficult to understand why someone would sell a note at a discount.

Once the note is purchased, you as the investor now own the note, literally becoming the bank. As such, you have many different options, which we’ll cover.

Note Flipper 9 THE BASICS OF NOTES

BENEFITS OF NOTE INVESTING

Think of real estate note holders like landlords. Like landlords, note holders are paid monthly, which is the big appeal to this approach. What’s the difference? Unlike “traditional” real estate investors, note holders never have to worry about filling vacant units or qualifying tenants. They also don’t have to roll up their sleeves and dig into repairs, remodeling or basic maintenance. Instead, note holders generate value—and profits—from working with borrowers versus investing in materials and labor to improve a property.

That’s just the tip of the iceberg. There are countless reasons note investing is more attractive than ever. For starters…

1. Passive Income Despite not being part of the heavy lifting, note holders still get the perks of being involved in the investing process. Month after month (for often 20 to 30 years), note holders get paid without the headaches, hassles and hefty costs tied to rehabbing, and other go-to investing methods.

2. Attractive to Investors The “tenant-free” piece is another huge draw to the note holding approach. If you can find reasonably-priced notes, you’ll always have investors at the ready.

3. Invest From Anywhere For new and first-time traditional real estate investors, it’s often advantageous to focus on your local market. With note holding, your investing landscape expands dramatically and immediately, giving you access to more opportunities from day one. What’s more, it can be 100% virtual. For the most part, you wouldn’t need to visit properties, no in-person closings, no meetings with lenders, nothing. If you’re looking for a work-from-your-bathrobe opportunity, this is IT.

4. Quick Transactions Note deals can take only a few weeks to close—and for you to get paid. But rehab a property and you could be looking at months or even a year until you’re cashing that check. When you rent, it’s likely going to be years before you break even and start making real money.

Invest in notes and the profitability is completely different. These deals usually happen very quickly without inspections, lengthy escrow periods and financing hiccups. In my experience, it’s not uncommon to close a notes deal in 15 to 45 days, sometimes less. Because of the relative hands-off nature of the business, it’s not hard to have multiple notes deals in motion at any given time. In other words, you don’t necessarily have to close one deal every 15 to 45 days—you could easily be closing two, three or even more simultaneously, growing your profits exponentially.

Note Flipper 10 THE BASICS OF NOTES

Why Should You Flip Notes NOW? In 2014, the FDIC Insured Banks had about $147 billion in “B”-ranked —i.e. non-performing notes (NPNs). The following year, they sold about $13 billion of those loans, followed by another $18 billion in 2016 and $17 billion in 2017. In 2018, they kicked off the year with more than $100 billion in these on the books, with the trend clearly on a path to not just continue but really grow over the next few years.

What’s the takeaway?

This is a HOT market, and it’s only getting hotter. For investors who can get in now, the opportunities are endless. Too often, people wait until a starts soaring or a market goes through the roof in a very big, very public way before they get involved. That’s problematic. When everyone floods a corner of any investment-based industry, they immediately dilute the opportunity for everyone. There’s more competition and less to go around. But in my experience, notes are like this hidden gem in a sometimes-chaotic industry. People don’t “get” them or they simply don’t know about them.

This creates MASSIVE opportunity for us.

TYPES OF NOTES

With the benefits clear, let’s dig into some of the different types of notes. For me, some of the best opportunities lie in performing notes, re-performing notes, , and non- performing notes (NPNs). Collectively, these investment opportunities provide some of the best, safest returns available anywhere in the world today.

Let’s go into a little detail on each:

Seller Financing “Seller financing” or “owner financing” means exactly what it sounds like. The seller acts as the bank, financing a buyer who wants to buy their home or investment property. As “the bank,” the seller/owner collects monthly payments from the buyer over a predetermined period of time and, often, a down payment upfront. This is different from traditional sales when the buyer finances with a bank or lender and the seller receives a lump sum at close.

Note Flipper 11 THE BASICS OF NOTES

By providing owner financing, sellers are able to, minimally, get a solid down payment and generate a steady income stream plus interest over an extended period of time. Even today, upwards of 30% of mortgage applications are rejected, creating a market for these deals from coast to coast. By offering to finance the sale, owners can engage buyers who can’t secure a loan through traditional means. This immediately extends the buying pool, creating more opportunity all around.

Institutional Loans Institutional loans can be broken down into three main classes: performing notes, non- performing notes (NPNs), and re-performing notes.

}} Performing Notes: Borrowers pay as agreed and the note holder gets a check every month, as promised. The cash flow is consistent and reliable. Think of performing notes as the homeowner who pays his mortgage on time month after month, without ever falling behind.

}} Non-performing Notes: These are the opposite—this person doesn’t pay or is highly inconsistent. Even so, NPNs are good opportunities. From day one, you as the note holder gain unparalleled negotiating power.

In the case of NPNs, an investor purchases the loan after the borrower has stopped making payments. Banks choose to sell these loans rather than keep them on their books. In exchange for taking them, buyers tend to get a very steep discount. Keep in mind that when you buy NPNs, there is a legal process involved but it’s often very streamlined. Again, it’s in the bank’s best interest to get you to buy so they no longer have to carry the liability.

This is my core industry—NPNs. As you’ll see in this guide, there are countless ways to architect NPN-based deals. Once you have your head around this notion and the actual process involved, you’ll be able to see the endless possibilities open to investors in this market and, from there, determine how and where you want to specialize.

}} Re-performing Notes: These are loans that started as performing and then went non- performing until a new loan workout was made. Since the loans have been modified, they are now paying again.

My business is also very active in re-performing notes. You may decide to do the same, or you may decide to specialize in one type of note. It’s completely up to you. There are significant market opportunities for all of these notes right now, and those opportunities are better than anything I’ve seen in the last 30 to 40 years.

Note Flipper 12 Becoming a Deal Architect

BUYING ON THE EDGE

Note investors buy on the EDGE. Compare this to mainstream real estate which is bought and sold through traditional real estate agents and bank-led mortgages, often at a discount or on the fringe. Push a little further—specifically, push toward notes and the edge—and you’ll immediately see what an underserved market it is. It’s another benefit to operating in this space—there’s significantly less competition, even for the very best deals.

Determining Your Exit Strategy While it’s not hard to make money investing on the edge, you do need a clear-cut exit strategy going in. Whether you buy an through seller financing or institutional lending, you must know exactly how you’re going to get OUT—and get paid. Before signing on the line, be sure to ask yourself, What am I going to do to profit from this note...and WHEN?

Don’t let this piece overwhelm you. Believe it or not, this is my favorite part of investing. With most real estate deals, there are only a few exit strategy options—you may be able to wholesale it, rehab and flip it or rent it out, but that’s it. With notes, you have lots of options Become a true deal architect and you have a host of options including:

Note Flipper 13 BECOMING A DEAL ARCHITECT

1. Create Your Own Mortgage Note. Purchase distressed or otherwise affordable properties, rehab them and flip them to a new buyer. In this scenario, you as the note holder become the bank and finance the sale.

2. Seller Financing. As discussed earlier, the seller or owner becomes the bank. In these deals, you as the investor negotiate price and terms and arrange for the seller to finance the deal. This is my favorite approach because it’s easy to buy rental properties with no money down. Everyone talks about buying with nothing down, but very few can actually do it. If you take this approach, it’s completely doable.

3. Offer Owner Financing Yourself. This is a very unique and straightforward option. In this scenario, you as the investor act as the bank for the buyer. Look for quality notes with substantial returns, then buy them from the owners at a discount. The ideal situation for these deals is to identify someone who can’t get a mortgage—perhaps they’re self- employed or a legal resident without full citizenship. These are massive marketplace voids with huge populations. Even if you don’t have the funds yourself, it’s easy to drive massive paydays from these deals without investing your own cash upfront. We’ll touch on these funding options later. As you’ll see, by holding onto the notes yourself instead of selling them to a third-party, it’s easy to drive massive revenues via monthly payments for a steady income stream that can last years if not decades.

4. Broker or “Wholesale” Notes. In the case of broker or flip notes, you as the investor can lock up note deals, then broker them to a or fellow investor. Essentially, you’ll be the “note wholesaler.” This is a GREAT and often misunderstood approach. When you wholesale mortgage notes, the buyer winds up doing most of the work and pays all or almost all of the expenses, whether the deal happens or not. That same buyer also puts up all of the money to close the deal and assumes all risk. Your job is to find the deal, negotiate the price, gather relevant information and get paid.

In these scenarios, the broker contacts the note holder to if there’s interest in selling. If so, the broker becomes the middleman and contacts a funding source to come to a price— assume discounts ranging from 20% to 40%. The broker then takes his/her fee from the total. In most cases, this is about 7% to 10% of the sale, if not slightly more. The broker contacts the note holder and offers to buy the note at the adjusted price (the discounted price minus the broker’s fee). At closing, the broker receives his or her fee and the balance is paid to the note holder.

Brokering notes is exactly how I got started in this business. It’s low-risk and the people who buy and sell notes can earn thousands from every transaction without investing their own capital. These tend to be very quick deals that put cash in your pocket fast.

Note Flipper 14 PartPart 3:Part Four 3:Part Four 3: Steps Four 3: Steps Four toSteps toSteps to to BecomingBecomingBecomingBecoming a Deal a Deal a Architect Deal a Architect Deal Architect Architect BECOMING A DEAL ARCHITECT eeping in mind that our goal is to become a deal architect, we’re going to eeping in mind thateeping our goalin eepingmind is to that becomein mind our goal thata deal isour toarchitect, goalbecome is towe’re abecome deal going architect, ato deal architect, we’re going we’re to going to focus on NPNs. To reach this stage, you’ll need to focus on four simple focus on NPNs. focusTo reach on thisfocusNPNs. stage, on To NPNs. you’llreach need thisTo reach stage,to focus this you’ll on stage, four need simpleyou’ll to focus need onto focusfour simple on four simple KKsteps: steps:Ksteps:Ksteps: KeepingStep 1:Step inFinding mind 1: Finding theStep that deal our1: theFinding Stepgoal deal is1: the toFindingStep becomedeal 3: theFundingStep adeal deal 3: the Funding Steparchitect, deal 3: FundingtheStep we’re deal 3: goingtheFunding deal to thefocus deal on NPNs. To reachStep this 2:Step Pricing stage, 2: Pricingthe Stepyou’ll deal 2: needthe rightPricingStep deal to 2: therightfocus PricingStep deal on 4: right the fourClosingStep deal simple 4: theright ClosingStep deal steps: 4: theClosingStep deal 4: the Closing deal the deal

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Rinse, repeat and you’ve got a note-flipping business. That’s all there is to it. FindRinse,ing repeatRinse, Deals and repeat Rinse,you’ve andPricing repeat got you’ve a note-flippingand gotDeals you’ve a note-flipping got business. aFunding note-flipping business. That’s Deals all business. That’sthere isall tothereClosingThat’s it. is all to there it. Deals is to it. Now, let’s go through these steps in greater detail: Now, let’sNow, go through let’sNow, go thesethrough let’s stepsgo these through in greatersteps these in detail: greater steps in detail: greater detail: Rinse, repeat and you’ve got a note-flipping business! That’s all there is to it. STEP 1: FINDING DEALS STEP 1: FINDING DEALS Now, let’s STEPgo through STEP1: theseFINDING steps1: FINDING in greaterDEALS detail: DEALS The first step is finding deals. We’re going to focus on the lowest price band— under $125,000.The firstThe stepThese first is arefinding Thestep the first ismost findingdeals. step prevalent isWe’re deals.finding andgoing We’rewill deals.to bring focusgoing aWe’re lottoon offocusthegoing different lowest toon focusthe pricelowest on band—the price lowest band— price band— note opportunities.under $125,000.under Another $125,000. Theseunder benefit are$125,000. These theis that most are youThese the prevalent won’tmost are have theprevalent and mosta lotwill of prevalentbringand institutional will a lot bring and of different willa lot bring of different a lot of different competition.STEPnote opportunities. When 1:note FINDING all opportunities. of thenote Another hedge opportunities. DEALS funds benefitAnother flooded isbenefit Another that the you is Floridabenefit thatwon’t yourental ishave thatwon’t marketa lotyou have of won’tinstitutional a lot haveof institutional a lot of institutional during competition.the foreclosurecompetition. When crisis,competition. all theyWhen of the bought all hedge ofWhen everything—butthe funds hedgeall of flooded the funds hedge nothing floodedthe funds Florida under theflooded rental Florida themarket rental Florida market rental market $100,000.Theduring first They thestep duringjust is weren’tfinding theduring foreclosure focused the crisis, thedeal foreclosureonthey. We’re crisis,a lowbought going pricethey crisis, everything—but boughtband, to focus they which everything—but onbought theleft tremendousnothinglowest everything—but price undernothing band—under under nothing under $125,000. opportunity for wholesalers, rehabbers and other investors buying at this level. These$100,000. are $100,000. the They most just$100,000. They prevalentweren’t just focusedTheyweren’t and just will focusedon weren’t a bring low on pricefocused a a lot low band, of price on different awhich lowband, price left note which tremendous band, opportunities. left which tremendous left tremendous Another benefitopportunity is opportunitythat for you wholesalers, opportunitywon’t for wholesalers, have rehabbers for a lot wholesalers, ofrehabbers institutionaland other rehabbers and investors othercompetition. and investors buying other at investorsWhenbuying this alllevel. at of buyingthis the level. hedge at this funds level. There are different types of notes to target: flooded the Florida rental market during the foreclosure crisis, they bought everything—but nothingThere areunderThere different $100,000. areThere different types areThey of differenttypesnotes just weren’ttoof target:notestypes focused toof target:notes on to atarget: low price band, which left tremendous opportunity for wholesalers, rehabbers and other investors buying at this level.

So, for the big question...whereLearn How To doBuy And you Sell Notes find For Bigthese Profits! notes?Note Flipper 15 Learn How ToLearn Buy HowAnd SellToLearn Buy Notes And How For Sell To Big NotesBuy Profits! And For Sell BigNote Notes Profits! ForFlipper BigNote Profits! Flipper15 Note Flipper15 15 Hedge Funds & Private Equity Firms Both the seller finance side and the institutional side—the performing, non-performing and re- performing side—look to the hedge funds and private equity firms. Companies like Goldman Sachs are among the biggest buyers of NPNs in the marketplace. Once they have them, they’ll often sell off NPNs to smaller companies or private equity funds. My company buys them by the case and sells them by the bottom. That’s how many companies in the space operate. In that sense, it’s not hard to buy notes. Guys like me are selling them around the clock, using inventory we get from the Goldman Sachs of the world.

Note Flipper 15 BECOMING A DEAL ARCHITECT

Distressed Owners The alternative is distressed owners. These motivated sellers have some kind of need and that need usually involves money. While this can be a bit more challenging from a ‘find’ perspective, there tends to be a lot more opportunity to architect a deal since you’re working one-on-one. Best of all, everyone walks away happy. You solved the property owner’s biggest problem and walked away with a valuable note.

What’s amazing about these deals is that distressed sellers may agree to terms the average investor simply can’t get anywhere else. We looked at our last 1,000 seller finance notes and about 20% of these notes were written at 0%. You will literally not get a deal like this anytime, anywhere.

Another perk is that you don’t have to spend any money finding these deals. If you have internet access, you can easily search ads and (FSBO) listings, and see if they’re interested in seller financing. Look for clues like “seller financing available” in the ad or keyword search.

Many of the people running these ads are actually real estate investors. If you can hook up with them, you can pick up notes over and over and over. I maintain that exact list for my business so I always have an audience to reach out to when we’re looking for deals. STEP 2: PRICING DEALS

Now, how do you actually price these deals?

In short, the process of buying NPNs is very similar to buying distressed, fixer upper properties. It all comes down to PRICE and VALUE. When you buy an NPN, you’re essentially buying a note that needs rehab work. Because of the nature of NPNs, it’s not uncommon to lock them down for as little as 30% of the as-is property value. On the other end, REOs and are selling at more than 80% of their as-is value, with short sales decreasing to less than 2% of the market. It’s just another reason NPNs are a solid bet, with more opportunity and less competition than virtually any other investment outlet.

What ballpark do YOU want to play in—distressed real estate or distressed notes? If you’re still scratching your head, try this one: would you rather pay 30% or 80% value for your first—or next—great investment deal? The answer is clear to me. That’s why I’m all-in on note investing.

In my world, the average value of a property with a NPN is about $40,000 to $60,000. The interesting part is that the is significantly higher—these properties usually rent for about $600 to $1,000 per month. This is why these are such good cash flow properties, with a lower price point giving the opportunity for incremental revenue down the road.

Note Flipper 16 have to spend any money finding these deals. If you have internet access, you can easily search ads and for sale by owner (FSBO) listings, and see if they’re interested in seller financing. Look for clues like “seller financing available” in the ad or keyword search. have to spend any money finding these deals. If you have internet access, you Many of the peoplecan runningeasily search these ads ads and are for saleactually by owner real (FSBO)estate listings,investors. and seeIf you if they’re interested in seller financing. Look for clues like “seller financing available” in the can hook up with them, you havecan pickto spend up anynotes money over finding and overthese anddeals. over. If you I maintainhave internet access, you ad or keywordcan search. easily search ads and for sale by owner (FSBO) listings, and see if they’re that exact list for my businessinterested so I always in seller have financing. an audience Look for toclues reach like “seller out to financing when available” in the have to spend any money finding these deals. If you have internet access, you we’re looking forMany deals. of the peoplead or keywordrunning thesesearch. ads are actually real estate investors. If you can easily search ads and for sale by owner (FSBO) listings, and see if they’re caninterested hook up in with seller them, financing. you can Look pick for up clues notes like over “seller and financing over and over.available” I maintain in the Many of the people running these ads are actually real estate investors. If you thatad exact or keyword list for search. my business so I always have an audience to reach out to when STEP 2: PRICINGwe’re looking forcanTHE deals. hook DEAL up with them, you can pick up notes over and over and over. I maintain that exact list for my business so I always have an audience to reach out to when Many of the people running these ads are actually real estate investors. If you we’re looking for deals. In my world, the STEPaveragecan hook 2: value up PRICING with of them, a property you THE can withpick DEAL upan notes NPN over is aboutand over $40,000 and over. to I maintain $60,000. The interestingthat exact part, list forthough, my business is that so their I always rental have value an audience is significantly to reach out to when we’re lookingSTEP for deals. 2: PRICING THE DEAL higher—these propertiesIn my world, usually the average rent for value about of a property$600 or with $1,000 an NPN per is month. about $40,000 This is to why they’re such$60,000. goodSTEP cash The 2: interesting InflowPRICING my world, properties, part, the THE though,average with DEAL valueis athat lower of their a property pricerental valuepointwith an isgiving NPNsignificantly isthe about $40,000 to opportunity for incrementalhigher—these revenue $60,000.properties Thedown usually interesting the rent road. forpart, about though, $600 is thator $1,000 their rental per month. value is This significantly is why they’re suchhigher—these good cash properties flow properties, usually rentwith fora lower about price$600 orpoint $1,000 giving per the month. This is In my world, the average value of a property with an NPN is about $40,000 to why they’re such good cash flow properties, with a lower price point giving the Let’s use that range—$40,000opportunity$60,000. The for interestingincremental to $60,000. part, revenue though,If the down property is that the their road. is rental worth value that, is significantlyI’m opportunity for incremental revenue down the road. looking to negotiatehigher—these and buy the properties note on usually that rent property for about for $600 $15,000 or $1,000 to $20,000.per month. This is Let’swhy use they’re that suchrange—$40,000 good cash flow to $60,000. properties, If the with property a lower isprice worth point that, giving I’m the Let’s use that range—$40,000 to $60,000. If the property is worth that, I’m BECOMING A DEALlooking ARCHITECTopportunity to negotiate for incremental and buy revenue the note down on that the propertyroad. for $15,000 to $20,000. So, to break it down: looking to negotiate and buy the note on that property for $15,000 to $20,000. Let’s use that range—$40,000 to $60,000. If the property is worth that, I’m So, to break it So,down: to break it down: • The property valuelooking is $40,000to negotiate to and $60,000 buy the note on that property for $15,000 to $20,000. • The property• valueThe property is $40,000 value to is$60,000 $40,000 to $60,000 • There’s a non-performingSo, to break note—init down: other words, the homeowner isn’t paying So let’s use that range—$40,000• There’s a non-performingto• $60,000.There’s a Ifnon-performing the note—in property other note—inis words,worth other thatthe homeowner words,amount, the I’m homeowner isn’t looking paying toisn’t paying • I’m going to negotiate• The property the note value on is that $40,000 property to $60,000 for about $15,000 to $20,000 negotiate and buy the• noteI’m going on that to• negotiatepropertyI’m going thefor to negotiatenote$15,000 on that theto $20,000.propertynote on that for So, propertyabout in other $15,000 for words: about to $15,000$20,000 to $20,000 • There’sOwner a non-performing note—in other words, the homeownerBuyer isn’t paying Owner Owner Buyer Buyer • I’m going to negotiate the note on that property for about $15,000 to $20,000 Note Note Note $ Owner $ $ Buyer Note Property value $ Note on that property for Property value$40,000 to $60,000 Note on that property$15,000 for to $20,000 PropPropertyerty value value is Owner isn’t paying, becomes NegotiNote on atethat andproperty buy for the $40,000 to $60,000 $15,000$15,000 to $20,000 to $20,000 $40,000 to to $60,000 $60,000 PropertyHowever, valueNon-performing all of this depends note on thenote property for $15,000-$20,000 owner.Note on thatThink property about for it as if you However,$40,000 all toofwere $60,000this adepends bank. Say on you the have property a self-employed owner. Think person $15,000about with it to as stellar$20,000 if you credit. He can’t However, all of this depends geton athe traditional property mortgage—neither owner. Think can about the traditionalit as if you wage earner with terrible wereHowever, a bank. all Say of this you depends have a self-employedon the property person owner. withThink stellar about credit.it as if youHe can’t However,were aall bank. of this Say depends you have on the acredit. self-employedproperty If you owner. had to person choose one,with though, stellar who credit. would He you can’t prefer to work with? getwere a traditional a bank. Say mortgage—neither you have a self-employed can the traditional person with wage stellar earner credit. with He terriblecan’t get a traditional mortgage—neithercredit.get a If traditional you had tomortgage—neither choose can theone, traditional though, can the who traditionalwage would earner you wage prefer withearner to terrible withwork terrible with? Thinkcredit. about If it you as ifhad you to werecredit. choose a If bank. you one, had Say tothough, youchoose have one,who a self-employedthough, would who you would prefer person you to prefer with work stellarto with?work credit. with? He can’t get a traditional mortgage—neither can the traditional wage earner with terrible credit. If you had to choose one to work with, who would you prefer? Who would beLearn more How To valuable? Buy And Sell Notes Clearly, For Big Profits!it’s Note Flipper 17 the self-employed guy with better credit. Chances are, he’ll continue to perform and pay. Learn How To Buy And Sell Notes For Big Profits! Note Flipper 17 Learn How To Buy And Sell Notes For Big Profits! Note Flipper 17 Remember: a note is a promise to pay. So in pricingLearn How and To Buy And Sell Notes For Big Profits! Note Flipper 17 analyzing notes, we need to analyze the probability of When Pricing Notes, Consider: getting paid back, which comes down to willingness • Probability of getting paid back and ability. • History and credit • Loan (terms, interest rate, length) To that end, you need to analyze history and credit. • Beyond that, it’s important to analyze the loan itself— the terms, the interest rate at which the loan is written and how long it’s payable. Some seller financed notes are written at 8% or 10%. But, twenty percent of mine are written at 0%. Think about that for a minute—wouldn’t rate impact the discount applied to your note purchasing? Of course. You’ll also need to consider what a lender or a note buyer calls “collateral.” Collateral is the property that secures the loan. It could be land, a house, —it doesn’t matter. All of this feeds into the consideration set.

When I first started in this business, I had no idea how to price every note, but I was a flipper— so my funding source would price the note for me. Then, I would just price below that number. If you know what people are paying for notes in the end, it’s easy to back into the wholesale pricing. So if a rehabber is willing to buy for $100,000, I should buy for $80,000—the spread makes sense. It’s the same mentality with notes but, here, there are more options available.

Note Flipper 17 BECOMING A DEAL ARCHITECT

STEP 3: FUNDING DEALS

Once you figure out your numbers, the next step is FUNDING the deal. When investing in notes, the funding process is similar to other real estate investing methods. However, as we discussed earlier, depending on your deal structure, your exit strategy will determine whether or not you’ll need money. Because notes come with so many unique structuring opportunities, you automatically gain extra advantages when you get to the funding stage.

Here are some funding sources to consider:

Institutional Investors are always an option—think banks, investment firms and private equity firms like the ones we buy from daily. There are also brokers. We notes everyday from people who are trying to earn fee income. Essentially, anyone or any formal organization with a substantial amount of money to put on the line is an institutional investor.

Private Lenders could be anyone—maybe someone in the business of private lending, or maybe it’s just a person interested in investing in real estate without handling the heavy lifting themselves. A quick Google or LinkedIn search will help turn up private money lenders, or you can try to tap your own personal/professional network to find a lender. It’s VERY common for private lenders to buy notes and other “paper” .

Passive Investors can be a great funding source. My wife leverages this approach constantly. She finds someone to fund the first 10 or 20 years of the note—someone who doesn’t want to do the legwork and find their own notes or investments. She then sells them the first half of the note for the price of the whole note. Passive investors are incredible resources because, often, they’ll fund multiple deals over time, helping you generate more wealth in a fraction of the time. If you can show results, you’ll have passive investors lined up ready to fund deals.

Self-Directed IRA Accounts are also a common funding source. If you have a self- directed IRA or 401K, you may be able to take those funds and put them into real estate or, in this case, notes. Talk to your company or retirement account holder to see if your accounts qualify. If they don’t, you can likely roll over what you have into a self-directed account, then withdraw to fund your notes.

If you’ve been wholesaling, rehabbing or bird dogging, you likely have some semblance of a cash buyer list on hand. Use it. These buyers can be incredible private lenders—they have the cash available, after all. Reach out to your list and share the opportunities. If they stack up, you won’t have an issue securing private money.

Note Flipper 18 BECOMING A DEAL ARCHITECT

STEP 4: CLOSING DEALS

Once you’ve found, priced and funded your notes, the final step is closing the deal. Closing note deals is fairly similar to traditional real estate closings. If you’ve ever bought a property, then you probably have some sense of how the process goes.

In the case of closing note deals, you’ll need: }} Title search }} Terms of the agreement—what you’ve agreed to pay and the closing terms }} Closing time frames—usually, this is quicker if you aren’t leveraging institutional funds }} Potentially, a title company

I’ve closed many deals with a title company, treating note transactions just like traditional real estate transactions. I don’t do that anymore, but you may decide to, especially early on. If you opt to flip a note, the investor will likely have that structure in place. Sometimes, it just makes sense to go with the flow, especially if the investor is accustomed to it. A good title company will do a lot of your due diligence, which takes quite a bit off of your plate in the beginning.

As you can see, conceptually the deal architecting and note process is not that much different than other real estate investing deals. The rewards this process brings are vastly different. That’s the true power of notes.

If we look back at the real estate investor chart we discussed earlier, you’ll say that it can really line up with the note market, too.

Note Flipper 19 BECOMING A DEAL ARCHITECT

Early on, you can be a bird dog or note wholesaler. Then, you go into the rehab stage where you’re seller financing or using passive investors. The landlord stage is when you hold onto notes for the long-term. At every stage of this graphic, you’re taking what you’ve learned and bringing it together with your new ability to create terms and develop structured deals in ways that not only solve the seller’s problem, but increased profits for YOU.

The Power of Velocity Keep in mind, all of this hinges on timing and velocity. For example, for our capital fund we bought 300 notes. But, we don’t sell 300—maybe we sell 150 immediately, generating immediate profit, that then gets boiled into the long-term profits that result from the other 150 notes we hang on to.

Another example is flipping a note. When I started out, I didn’t have any money to invest. I knew I needed to figure out a way to generate income. The velocity of simply tying up a note and taking it to an investor meant I never actually had to fund it. I was brokering single deal by single deal until I’d built up the capital and the understanding to take things in a different direction, which gave me tremendous flexibility. Sometimes, I buy and hold long- term. Sometimes, I go for the velocity move. It all depends on the situation.

That’s the power of timing and velocity. By better understanding timing, we’re able to recognize where the market has an opportunity and executing on it immediately. No one wants to spend their life looking back and regretting every decision. In my experience, that is what separates the best real estate investors from the pack. More importantly, that’s what I foresee for the notes niche. I have a feeling many people will look back in a few years and wish they learned about note investing. That’s not you, though. You’re learning the ropes and poised to take advantage of the mounting opportunities in the marketplace.

CHAOS BRINGS OPPORTUNITY

As you work through the initial stages of finding and securing notes, you’ll discover that chaos brings opportunity in this business. During the market crash and subsequent recession, opportunity opened up almost immediately. Every time something catastrophic happens—a crashes or the stock market plunges—things get bad for a lot of people. For a select few who understand timing and velocity, the end results are overwhelmingly positive.

Note Flipper 20 Making Money Flipping Notes

As you can now see, note investing offers viable exit strategies for virtually every deal. It’s all about looking at a deal and determining what works good, better, BEST. As you keep going, you might decide to use certain strategies for certain deals and other strategies for others. You become limitless in how you find and structure deals, cooking up endless opportunities your competition simply can’t or don’t see. They’re so busy flipping properties that they can’t see a different and better way to do things. But I can. Note flipping allows you the opportunity to make huge profits...

}} WITHOUT tenants calling you in the middle of the night because the toilet is backed up— you have the note }} WITHOUT fighting landlords to fix up the property—technically, it’s not your property }} WITHOUT the headaches and hassles of rehabbing a property and hoping for the best— you’re just the note-holder

It’s all the benefits of real estate investing and property ownership without the detractions and distractions. It’s a simple, powerful way to grow your short- and long-term wealth consistently, deliberately and without the headaches, risks and upfront capital that comes with traditional real estate investing—or investing in general.

If you’re still scratching your head, know this: while note investing may seem technical or complex, I assure you that you CAN do this. No matter what you want, note investing and note flipping can take you there and give you the financial freedom you’re looking for. Thousands of my students have done it. They had no real estate investing experience when they started out, and now they’re building full-on “note empires” on THEIR terms.

So, why not you?

Note Flipper 21 MAKING MONEY FLIPPING NOTES

Here are a few deals from some of our Note Flipper students... CASE STUDIES

SO LONG, RAT RACE...

SELLER FINANCED DEAL Property: Duplex in Seattle, WA Deal Structure: $325,000 with $5,000 down; structured as a 30-year term at 5% with $60,000 carried at 0%. All payments due in 10 years What Happened Next: Found tenant to cover entire monthly payment ($1,400/month) plus $100 profit

Kevin Moen came to our Masterclass with the goal of becoming a full-time notes investor. Right out of the gate he wanted to buy a house, but since he’d recently left his job he couldn’t get bank financing. His solution was to send 550 mailers to people who owned their properties free and clear, explaining his story and looking for seller financing. It worked and, sooner after, he structured a deal on a great duplex. Kevin and his fiance moved in on one side and found a tenant for the other side who would pay $1,500 per month—$100 more than Kevin’s monthly payment. What’s amazing is he was relentless—he knew what he wanted and he went after it. When he realized he would be $60,000 short, he went back and asked the seller to carry the $60,000 at 0%...and it worked.

SMALL BUSINESS OWNER WITH ZERO INVESTING EXPERIENCE…

Property: Fix-and-flip in South Carolina Deal Structure: Bought property for $14,583, with rehab costs of $12,268 (total investment: $26,851) What Happened Next: Opted to “be the bank” and seller-finance to a buyer for $69,900 with $5,000 upfront Profit: $5,000 upfront + $658 per month for 30 years

Though Tim Siebelink had no real estate investing experience, today he’s doing deals in THREE states. Keep in mind, though, he didn’t have this kind of capital early on. In the beginning he created notes and flipped them for profits, even though the notes were sold at a discount. This enabled him to recapitalize until he could buy a property, sell it with owner financing and sell the note.

Note Flipper 22 MAKING MONEY FLIPPING NOTES

AN AMAZING PATH FOR AN AMAZING FAMILY

Property: Fix-and-flip in Independence, MO Deal Structure: $17,000 structured as owner-financing with $500 down and a seven-year term with 5% interest

Flip: The couple sold the property for $48,000 with $7,000 down Profit: $220/month (Generating $455/month and paying the former owner $235 per month. PLUS they made $6,500 on the “new” down payment)

Brian and Michelle Winberry have fostered more than 300 kids in recent years and were looking for a new income stream to help them do more. The couple found a fix-and-flip in Independence, Missouri. The previous owner wanted $17,000 for their inherited property. This couple were able to negotiate owner financing with $500 down with a seven- year term, with 5% interest. They also added in the contract, that if the owner ever sold the note, he would give them right of first refusal. The final step was when Brian and Michelle sold the property for $48,000 with $7,000 down. One year later, the owner decided he wanted out and they negotiated the note at a discount—just $8,000 which, for the most part, came from that $7,000 down payment.

FORMER ELECTRICAL ENGINEER & FATHER OF TWO

Motivation: Imran was unhappy in his career path and didn’t see a path to wealth—but he also didn’t know how to change his trajectory to generate meaningful wealth

Profit: His turning-point deal was one of his very first: from a $13,000 deal he made $65,000, with subsequent checks landing in his mailbox month after month for five years

Imran attended our Masterclass with one goal: to leave his job. Today, he’s a full-time note investor. and he’s never looked back. He’s done more than 50 note deals so far, all based in the education he garnered at Notes School. More importantly, though, he can now finally live the life he’s always craved, working from anywhere and traveling the world month after month, from Brussels to Barcelona, Munich to Madrid, Prague to Paris and back again. And, while he’s kicking back and living the life, he’s turning $7,000 into $70,000, $12,000 into $60,000, $6,000 into $34,000 over and over again.

Note Flipper 23 MAKING MONEY FLIPPING NOTES

WHAT COMES NEXT

Now, you know what it takes to make money architecting deals and flipping notes.

So...now what?

Register for our FREE Note Flipper Masterclass.

This guide is just the first step in your journey to lasting success as a note investor and flipper. The next step is to ignite that flame and learn our step-by-step process to investing in and flipping notes for serious profit—all in your spare time. That’s where the Note Flipper Masterclass comes in.

In this FREE Masterclass, you’ll learn how to...

FIND PRICE FUND CLOSE the best notes those notes your deals deals for a profit

Whether you’re new to real estate investing or a total pro, this training will open your eyes to a whole new world of profit-generating—a process that can be easily integrated into your free time, without capital, without heavy lifting and without the skills or resources that most investing strategies demand.

}} We share how to buy the best notes from hedge funds and private equity firms }} We teach you how to seller and owner financing to cover YOUR best deals }} We’ll go STEP-BY-STEP through methods for locking down 0% rates over and over again }} We’ll show you why NON-paying and delinquent notes are the way to go

The Note Flipper Masterclass Training is 100% FREE to all registrants—but space is limited! Sign up now and learn the secrets to note investing and flipping, and be on your way to finding your fortune with this unique investing approach. Register now!

SECURE YOUR SPOT BELOW! www.howtoflipnotes.com/webinar

Note Flipper 24