Certainly the idea and concept of mortgage notes is not a new one. They have been used across the country for many decades. They seem to be seeing a surge of popularity recently, most likely due to the economic climate and the main stream lenders clamping down on finance for home and business buyers.

You should familiarize yourself with the concept of this way of making a property transaction, prior to entering into any agreement on the matter. The notes are an agreement between a buyer and a seller where the seller will offer finance on a portion of the sale price. Sometimes it can be on all of the sale price other times simply a percentage there of.

This agreement is drawn up by real estate attorneys acting on behalf of the seller and the buyer. Everything becomes negotiable and depending on the needs and wishes of each party, all the terms and agreements will be drawn up into a binding contract that both the seller and buyer will enter into.

The term of the seller finance on the notes is determined by the current daily rate, plus or minus depending on the seller and the negotiation that has been undertaken with the buyer. The length of time that the mortgage notes are valid for is also an important factor of the contract as the seller may choose to sell the mortgage notes later in time.

In this case there are a large number of brokers that can easily take the existing note off your hands. This is done at a percentage of the value of the mortgage notes current balance. You will not get 100% of the balance owing from a mortgage notes broker. This is a good way for properties to change hands and for both the buyer and seller to benefit without involving the traditional lending agents.