The Off-Market Protocol: A Note Holder's Guide to Private Disposition
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The Note Holder's Protocol A Mandate for Valuation & Execution
Selling a mortgage note is the liquidation of a secured financial asset. This protocol is the definitive framework for profiling your note, valuing it like an institutional investor, and executing a sale to qualified buyers via private treaty.
Market Intelligence: The High-Yield Environment
The primary force driving the mortgage note market is the high-interest-rate environment. Notes originated when rates were at historic lows (2-4%) must now be valued against a market where the baseline yield is significantly higher. This creates the "discount" effect: to be attractive, a low-coupon note must be sold below its Unpaid Principal Balance (UPB). The price is not what's left on the loan; it is what an investor will pay for its future cash flow in today's environment.
Key Valuation Factors
The Valuation Calculus: How Much is Your Note Worth?
Competitors offer generic "spot prices." We utilize a forensic calculation to determine the precise Net Present Value (NPV). Your payout is determined by three specific vectors:
The Yield Spread
If your note has a 4% coupon but the market demands 10%, the asset must be discounted to bridge that 6% gap. We minimize this spread by marketing to capital partners with lower cost-of-capital requirements.
Protective Equity (ITV)
Investment-to-Value (ITV). The more equity the borrower has in the property, the safer the note. A note with 40% equity coverage commands a premium price over a note with only 5%.
Payor Velocity (Seasoning)
A "Seasoned" note (12+ months of on-time payments) trades as a financial instrument. An unseasoned note trades as a speculative bet. We audit payment history to prove velocity and increase the strike price.
The Divestiture Protocol: A Three-Phase Mandate
Amateurs list a note on a public auction. Professionals execute a disciplined protocol to preserve the asset's integrity and command the highest price.
| Phase | Action | Outcome |
|---|---|---|
| 1. Asset Profile (Diligence) | Forensic audit of the Promissory Note, Deed of Trust, pay history, and collateral FMV. | An institutional-grade file that signals a professional seller. |
| 2. Valuation Matrix (Pricing) | Data-driven calculation of NPV based on Yield, Equity, and Seasoning. Classification as Performing, Re-Performing, or NPL. | A defensible, market-based price that maximizes your return. |
| 3. Disposition (Execution) | Confidential, private treaty sale to our vetted network of institutional buyers and funds. | Certainty of execution and conversion of future payments into immediate capital. |
Discipline Equals Dollars
Amateurs chase shortcuts. Professionals follow the protocol. If you are ready to convert your note into capital at maximum exit value, initiate a mandate today.
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