Sell a Note in Your State | Note Brokering

You can sell a private note in every US state and in the District of Columbia. The way a note is priced is the same everywhere. What changes from state to state is the paperwork that secures it and what a buyer would have to do if the payer stopped paying.

This page sorts the parts of a note sale that depend on the state from the parts that do not, and explains how to use the state pages beneath it. Treat it as a general guide. State law is amended from time to time and local practice differs by county, so have an attorney or title company in the property’s state confirm anything you intend to act on.

Which state’s rules apply to your note

For a note secured by real estate, the state that counts is the one where the property sits, wherever you or the payer live now. If you sold a house in Arizona and have since retired to Florida, a buyer looks at Arizona.

The reason is the security, the document that ties the debt to the property. It is recorded in the county where the property is located and enforced under that state’s law. Living elsewhere is no obstacle: you can sell a note on a property in another state, since a closing can be handled by mail through a title company.

Notes with no real estate behind them, such as a business note backed by equipment or by nothing at all, work differently. The note may name the state whose law governs it, and an attorney can tell you what applies if it is silent.

Finding and using your state’s page

There is a page for each state and one for the District of Columbia. Choose the state where the property is located. Each page describes the kinds of property and note holders found there, the security instrument in common use, the general shape of the foreclosure process, and what those mean for a buyer pricing a note in that state.

The state pages describe common practice and stop short of legal advice, so they cannot replace an attorney who works in that state. Foreclosure timelines, interest rate limits and licensing rules are left off them on purpose, because those details change and depend on the facts of each note.

What stays the same in every state

The core of the sale does not move when you cross a state line. A buyer decides the yield they need, meaning the annual return on their money, and calculates what they can pay today for your remaining payments. The gap between that price and the balance owed is the discount. To set the yield, the buyer studies the same things everywhere: the payer’s record and credit, the property’s value against the balance, your lien position (where your claim ranks against the property), and the quality of the paperwork.

Your options are the same too. You can sell the whole note, sell a set number of payments in a partial if the note’s term and record suit one, or keep it. The steps also run in the same order, from quote to review of the file, purchase agreement, closing and funding, as laid out in how to sell a note.

What changes from state to state

What varies	The forms it takes	Why a buyer cares
Security instrument	Mortgage, deed of trust, or either	It decides how the lien is transferred and enforced
Foreclosure process	Through the courts, outside the courts, or both available	It affects the time and cost of recovering the property after a default
Rights of the payer after default	Differ widely	They affect how certain and how quick a recovery is
Land contracts	Common in some states, rare in others	Rules on ending the contract after a default are state-specific
Recording and transfer	County practice, forms and fees differ	The assignment to the buyer must be recorded correctly
Lending and servicing rules	Differ by state	A buyer checks the note was made in line with the rules that applied

Mortgages and deeds of trust

A note is the promise to pay. The security instrument is the separate document that lets the note holder take the property if the promise is broken, and states use two main kinds.

A mortgage has two parties: the borrower and the lender. A deed of trust has three: the borrower, the lender, and a neutral trustee who holds a form of title until the debt is paid. Some states use one almost exclusively, and some allow both. From your side as the note holder they do the same job. A mortgage and a deed of trust sets out the difference in full.

When you sell, the note is endorsed to the buyer and the security instrument is assigned to them by a recorded document. The form you hold decides what that assignment is called and how it is prepared, and a note secured by either form can be sold.

Judicial and non-judicial foreclosure

Foreclosure is the legal process a note holder uses to recover the property after a default. In a judicial foreclosure, the holder files a lawsuit and a court supervises the process. In a non-judicial foreclosure, the security instrument contains a power of sale, and a trustee or the lender can sell the property by following steps set out in state law, generally without a court case.

Deeds of trust are commonly linked with the non-judicial route and mortgages with the judicial one, though the link is loose: several states permit both, and local practice matters.

A buyer thinks about this because every note carries some chance of default. Where recovering the property generally takes longer and costs more, that risk weighs a little more heavily in the buyer’s yield. Where it is generally quicker, it weighs less.

Keep this in proportion. For a note with a reliable payer and a property worth well above the balance, the foreclosure process is a small factor, and the payment record, the equity and the paperwork move the price far more than the state does. A buyer would sooner hold a strong note in a slower state than a weak one in a faster state.

Land contracts and contracts for deed

In some parts of the country, owner-financed sales are done by land contract, also called a contract for deed or installment sale contract. The seller keeps legal title until the buyer finishes paying, and there is no separate mortgage or deed of trust.

These can be sold, in full or in part. They are the area where state law differs most, because each state has its own approach to what a seller must do to end the contract after a default. Some treat it much like a foreclosure, and others allow a shorter process called forfeiture. Which of the two applies, foreclosure or forfeiture, is a question for an attorney in the property’s state before you describe the contract to a buyer.

Start with the property’s county

Your state shapes the paperwork, and your note’s own facts set the price. Find the recorded security document, note the county and state where the property sits, and check whether it is a mortgage, a deed of trust or a land contract. Include those when you send us the note details. We take the note to competing buyers, ask for a partial price where the term and payment record allow one, and return each offer with the worksheet showing how it was priced and what we earn. Asking costs nothing and commits you to nothing.