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The Advanced Note Broker


To be an advanced note broker means, simply, you are making money in the business. In fact, you will be, or are an advanced note broker if you do more than six deals a year. This may seem like a meager cut-off, but the competition is so rotten in this business that you are probably in the top 2% of brokers if you sell even four notes a year. Advanced brokers also do a hundred or more deals a year and make good six figure incomes. The point is that the transition from beginning to advanced is not as momentous as you may think, yet few do it. Why? Why is this business so replete with “beginners”?

The answer probably has to do with high powered TV ads selling expensive classes by over promising and making the discounted note business seem easier than it is. Thus they attract people who have no hope of succeeding.

Nonetheless, there are ways you can become an advanced note broker. There are skills you can develop that the beginning note broker does not have and there are talents you can foster that will make this business open up to you. These are:

  • calculator skills, beyond the basics,
  • marketing skills,
  • negotiation skills and
  • new outlets to sell your notes.

Those four skills, developed to fit your own unique talents and experience, can truly open up the business of note brokering to you. With those four you will be able to develop a richly satisfying business; without them you will be among the 98%. Remember, the world needs note brokers, we supply money on the secondary mortgage market. Without us note holders have no place to get cash, with us they can sell cash flows and re-invest the money in a more lucrative investment. In short, it is incumbent on all of us to become “advanced note brokers” so that the industry survives and matures.


An advanced note broker can calculate at least 25 ways to buy a cash flow. They can use the Internal Rate of Return and Net Present Value keys on their calculator. They use the computer software: Note Quoter and T-Value and can analyze any cash flow for its present value. They know how, why and when to restructure a note to increase its present value. The advanced note broker can look at a note and verify its internal consistency, the payments remaining and future value. They know the difference between yield and interest rate and, given the price of a note, can tell the yield. They know the difference between discount and yield. They can explain why a $100,000, 30 year note will sell for less than a 5 year $100,000 note. They can explain the discount with honesty and be able to show the seller advantages of selling their note.


You, as an advanced note broker, have developed a unique marketing plan to find and buy notes. It simply is not sufficient to copy the note finding techniques of someone else. You will build on your own background, techniques and experiences to find your niche in the highly fractionalized note market. Your note finding methods will be your own and the notes you buy will fit into your unique niche.

There are more notes in the world than any of us could ever hope to buy, but we have yet to develop the marketing method that will truly tap that market. We know, however that half hearted efforts at finding notes will not vault you into the ranks of the 2% advanced note buyers. If you are going to do direct mail, you should plan to mail out 10,000 pieces per month; if you are going to advertise, plan to have a coherent, well planned campaign that taps into markets no one else is tapping. Have professional materials and a professional way to handle the response. Plan to spend several thousand dollars and to be in it for the long haul.

If you plan to help professionals develop notes to broker to you, you must know all the legal ramifications of that approach and be professional and competent when talking to them. You must have expert materials and give a high level professional presentation.

In short, you must commit time, money and a lot of creativity to finding notes, anything less will cause you to fail. This advice probably holds true for much of one’s success in life.


The note business is a people business above all else. Unless you can handle the note seller in a professional manner, they will not sell you their note. We are dealing, for many note sellers, with the most money they have ever seen in their lives and if they do not trust you all the calculator and marketing skills in the world will do you no good at all.

Negotiation is another word for credibility or rapport. You will never buy a note from someone who does not trust you. To be an advanced note broker you must be able to establish your credibility immediately. The note seller must know that you know the business, that you can really buy their note and that you will treat them fairly. If you miss a step on any of those you have almost certainly lost the deal.

The good news is you can learn the skill of negotiation by taking a class, reading a book and being aware of how you affect other people. If you give no attention to your people skills you are neglecting the most important part of this and most any other businesses.

I would suggest the following books: Instant Rapport by Michael Brooks, Getting to Yes by Michael Hurley and Power by Michael Korea. You should tape your phone calls and critically analyze them with the help of a colleague.

You be very clear on your goals when handling an inquiry from a note seller; what do you hope to accomplish in this contact and how will you know if you accomplished it?

For example, when some calls with an initial inquiry about a note they have to sell, I want to do three things in the conversation, while at the same time letting them know that I am the best note broker in the world and they will never have to call anyone else. First, I want to find out if the deal is doable. Do they have note that can actually be sold or is at 110% LTV on a toxic waste dump? Second, how motivated is the note seller? Do they need the money quickly and desperately or are just curious about its value? Finally how much do they need and why. If I know the amount and why they need it I can tailor an offer to meet their needs.

If I get good information on those three items, viz. they have a good note, they want to sell it and I know why they need the money, I “close” the deal by getting the caller to commit to getting the papers I need as soon as possible. If I can do that I am on my way to a completed sale.

So the advanced note broker is a skilled people person with a plan for every encounter with a potential note seller.

Sell The Note

You are not usually going to get rich in the note business selling notes to established institutional note buyers, you will have to have your own controlled source of funds to sell the notes institutions won’t buy. There are many very safe notes that you can confidently sale to your controlled source of funds that the institutions will not buy. The controlled sources come primarily from three places: pension funds, your own borrowed money and private investors.


Howard Cook, the publisher of the now defunct The Mortgage has defined the advanced note broker as having these S-U-C-C-E-S-S qualities:

Superior Product: You buy notes other brokers cannot. You buy more cheaply, you close more quickly, you require less paperwork. You are the best note buyer, period. Your service and price to the seller is simply the best.

Unconventional Approach: You are not one of the 95% of the note brokers chasing 5% of the notes. You have developed a unique approach to the business that fits your character. You have not copied anyone else and others may say that you are crazy for doing the business in your way. You then know you are on the right track.

Control: You only deal with the decision maker when buying a note. You never deal through another broker, an attorney or a relative. You control the negotiation, the terms of the sale and the closing. If you do not control the transaction, it will not close.

Continuing Education: The business changes and you must change with it. You must read books, newsletters, take classes and continue to upgrade your knowledge. What works today will not work tomorrow, so as clever note brokers find new and better ways to do the business you must share in these new ideas.

Evaluation: If we accept that this business changes and we must improve our methods all of the time, we need to know what works and what does not. The advanced note broker is able to keep track of his or her business. What marketing ideas work and why? Why did I not close that last deal? How can I streamline my paperwork? How can I become more efficient? What daily activities do not contribute to my bottom line?

Sources: You must have sources to sell your notes that others don’t have, you must have referral sources for notes that others don’t have and you must have sources that will support you in your business. This means you must attend conventions and work with other successful brokers. Sources means you are connected to the note industry and support it.

Supplemental Programs: Advanced note brokers have other money making outlets within their business. The discounted note business is so rich that there many other money making opportunities that will present themselves to you. For example, originating loans, buying real estate with notes, working with defaulted notes and properties, selling real estate, referring your sellers to other professionals for a fee, teaching classes, becoming an expert on an aspect of the business and consulting, using notes with lease options, buying rental income streams, factoring accounts receivables, mobile home note, car paper notes, lottery winnings, structured settlements. The list is only limited by your imagination and creativity.

The advanced note broker does not follow the crowd, does not need a mentor and is a unique business person. The rewards are tremendous, the path is challenging.

To learn more, we sell inexpensive books at our secure on-line store.

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