Today’s REI Classroom Lesson

Jack Shea shares with us how to option notes and personal property while keeping your information private.

REI Classroom Summary

Keeping your information private and being able to partner inside of a trust can provide you with security and flexibility.

Listen to this REI Classroom Lesson

Real Estate Investing Classroom Show Transcripts:

Mike: Welcome back to the flipnerd.com REI Classroom where experts from across the real estate investing industry teach you quick lessons to take your business to the next level. And now, let’s meet today’s expert host.

Jack: Hi, my name’s Jack Shea and I’m a 30-year real estate and note investor and I’d like to talk to you today about a strategy for holding notes in a personal property trust, which I hold all my notes in a personal property trust and have been doing it for many years.

Mike: This show is sponsored by passiverental.com.

Jack: This has many advantages and it keeps the ownership, the beneficiary off the public record. It allows a note investor to take on two investors, or five, or even, or ten, any number as partners. Say it’s a large note, it can hold 20,000 each. It can hold whatever and they can exit if they like, sell their share to someone else. This is all done at the personal property level and it makes it more economical, safer, and private.

When you do that, change it, this ownership of the note to personal property, you can sell the beneficial interest of that note on terms. So you can sell a note on terms with a certain number of payments that’s different like a wraparound, and you can also put several notes in one personal property trust as a pool and sell that on terms. So this device allows you great flexibility with your notes.

I typically can sell a portion of my notes, the front portion, or part of the payments by assigning part of the payments to someone else and the note stays the same as in the public records and nobody’s privy to who’s who. That person may like to get cashed out. We could do it.

One thing about selling a note in a personal property trust to someone else, I can hold an assignment of the beneficial interest as security for the debt. That assignment of beneficial interest is of great value because you can foreclose and take the note back without going through the court system and the cost and delay of attorneys and all that. So holding an assignment of the beneficial interest is like holding a car title for a Buy-Here Pay-Here car note.

So it’s easy to do. It’s flexible. It’s legal in all 50 states and I think you will find it’s simple, easy to do and it will make your note investments more secure and more productive. If you’d like more information on that, you can find it on my website, jackshearealestate.com and there’s contact information for me. So good investing.

Mike: Passiverental.com is your source for turnkey, done for you, rental properties. If you’d like to be an investor and not a landlord, please visit passiverental.com to learn how to purchase cash-flowing, professionally managed rental properties in the hottest rental markets across the country. We can also help connect you with financing for your next property. Invest the easy way today and get started by visiting passiverental.com.

Please note, the views and opinions expressed by the individuals in this program do not necessarily reflect those of Flipnerd.com or any of its partners, advertisers, or affiliates. Please consult professionals before making any investment or tax decisions as real estate investing . . .

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Jack Shea
I have been investing in real estate, notes and personal property for over 25 years. I use trusts in every deal: options in many and IRAs and 1031 exchanges whenever possible.