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Paper Assets Capital - Passive Income through Conservative investments collateralized by real estate

Learn to Profit from Notes with Paper Assets Capital

Our educational materials are set up to help you better understand everything you need to know about buying and selling notes.

Do I need to understand the difference between a mortgage and trust deed?

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It is important that you understand the difference, especially if the notes you purchase originate in different states. About one half of all states use a standard mortgage while the other half use trust deeds. When a property is sold and a loan is granted, the borrower signs a note. In effect, this promissory note is the borrower’s commitment to pay back the loan to the lender.

Of course a promise doesn’t hold much water if there is no collateral behind it. Lenders always require the property be put up as collateral to guarantee the loan. In return, the lender takes either a mortgage or a trust deed as collateral. While sometimes these terms are used as if they mean the same, they are significantly different from one another.

Trust deed – When the note is signed, and a trust deed is used to secure the property, a trustee takes limited title of the property. In return, that trustee has the right to force a sale if the homeowner should fail to make payments which results in foreclosure. Trustees have the right to sell the property at a trustee sale in accordance with the laws of the state where the property is located.
Mortgage – When a lender holds a mortgage, the deed is in the name of the borrower. In order to enforce payment on a mortgage in default, the lender must go to court and demand a foreclosure. Once this is completed, there are other steps borrowers can take to “stall” giving up the home, whether or not they are making payments.

As you can see, in nearly all cases, a trust deed makes it a lot easier on the lender to foreclose on a property when the owner is not making mortgage payments. With a mortgage, there can be delays of upwards of two to five years after the payments are in arrears whereas with a trust deed, the process can be completed in a few months.
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Can I divide notes between specific accounts?

Am I able to use my Individual Retirement Account to invest in notes?

How are the values of notes determined?

What happens if I decide to liquidate a note after I’ve purchased it?


Is there a market for buying and selling notes that is easy to access?

What are balloon payments and how do they affect note values?

Can you explain what partials are?

Can you explain what note seasoning means

Why do you think notes are such a great investment?

Do I need to understand the difference between a mortgage and trust deed?

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