Understanding Partial Note Sales
What Is a Partial Note Sale?
When you sell a note, you don't have to sell the entire thing. A partial note sale allows you to sell a portion of your future payments while keeping the rest. This option gives you access to immediate cash without giving up all of your long-term income.
How Partial Sales Work
In a partial sale, you sell a specific number of payments to an investor. Once those payments are collected, the note returns to you and you continue receiving the remaining payments as originally scheduled.
Example:You hold a note with 180 payments remaining at $500 per month. You need $25,000 for a new investment but don't want to sell the entire note. You sell the next 60 payments to an investor. For the next five years, the investor collects the $500 monthly payments. After payment 60, the note returns to you and you collect payments 61 through 180.
Why Sellers Choose Partial Sales
Access cash without losing the full note.Get the money you need now while preserving future income.
Maintain long-term returns. You continue earning once the partial term ends.
Flexibility for specific needs.Match the sale to your exact cash requirement.
Retain ownership interest. You stay connected to the note and the property securing it.
Common Partial Sale Structures
StructureHow It WorksFront-end partialSell the next X payments, then the note returns to youSplit partialSell a percentage of each payment for a set periodBack-end retentionSell most payments but keep the final balloon payment
What Affects the Value of a Partial Sale
Several factors determine how much you can receive for a partial sale:
Payment history. Consistent on-time payments increase value.
Interest rate. Higher rates make your note more attractive.
Remaining balance. Larger balances offer more flexibility.
Property equity. Strong equity reduces investor risk.
Number of payments sold. More payments sold means more cash upfront.
Is a Partial Sale Right for You?
A partial sale works well if you:
Need a specific amount of cash for a defined purpose
Want to keep some long-term income from your note
Believe property values or buyer reliability will improve over time
Prefer not to exit the note entirely
If you need maximum cash now and don't want ongoing involvement, a full note sale may be a better fit.
The Process
Request a quote.Share your note details and how much cash you need.
Review your options.We present partial and full sale scenarios for comparison.
Choose your structure.Decide how many payments to sell.
Close and get paid.We handle the paperwork and wire your funds.
Conclusion
Selling a partial note gives you the best of both worlds—immediate cash and future income. If you're holding a mortgage note, land contract, or contract for deed and want to explore your options, contact us for a free evaluation. We'll show you exactly what a partial sale could look like for your situation.
