NoteSchool’s team, including its founder Eddie Speed, takes pride in delivering the highest level of note training. Not my words, but theirs. Specifically, it’s what they say about themselves on their website. Are they really that good, just decent, or bad bad? Heck, what do they even mean with note training? Is it a business model I’d recommend or nah? I’ll answer these questions in my Noteschool review below.
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In case you’re not familiar, the note training in Eddie Speed’s NoteSchool has something to do with real estate and you acting as a bank. Real estate and bank combined? Smells like foreclosed properties, amirite? Well, it’s indeed related to foreclosure, but it’s not all about that alone. Now what?
Actually, the reason you can invest in notes is that actual traditional banks [not you doing play-pretend] would rather avoid the hassle of properties within their control getting foreclosed. That’s why they would sell you notes [promissory notes if that rings the bell] which is essentially the written promise to pay loans where properties are the collateral.
Mind you, it’s not the note itself that ties the property as a collateral. It’s the security instrument we’re all familiar with in mortgage or deed of trust. So, in reality, when one purchases a note, you also purchase the mortgage. In other words, you’ll get secured debt and become the bank.
Becoming the bank means you’re entitled to receive payments from the borrower. How they, the borrowers, pay and how you, the note investor, gets your ROI depends on the type of notes. There’s performing notes where borrowers making regular payments means recurring passive income for ya. Since it can be bought at a discount, you can possibly get above average returns.
Then, there’s non-performing notes where borrowers have stopped making payments. Actual banks would want these off their books rather than possibly incur the expense of foreclosure. And as you’d expect, these notes are offered at a much steeper discount than performing ones which allows investors to offer multiple exit strategies (other than foreclosure) to its borrowers.
Apologies for the technical, not-so-lighthearted discussion, but basically, that’s the gist of note investing. Actual banks would rather stay in their lane, and this thinking of banks opens up the opportunity for you to swoop in, and turn things around with real estate knowledge.
The said real estate knowledge about note investing is something you’ll get with Eddie’s NoteSchool. Specifically, you’ll get the “most up-to-date, actionable training available” plus support in NoteSchool’s mentoring program. Not only that, you’ll also get access to an active community of like minded individuals, and collection of relevant documents, tools, and systems.
Most importantly, you’ll get access to their lists of quality assets aka the notes itself. Majority of it is from NoteSchool’s parent company, and then some from other vetted sources. T’is the most valuable part of the mentoring program once you’ve gained a good grasp of the basics. So far, so good?
Sounds promising and decent fosho until you heard the price of NoteSchool’s mentoring program. In particular, this NoteSchool’s offer would cost you a whoopin’ $16k. Too expensive considering that the only unique thang here is the access to the lists of notes. Like, you could get a similar training for much cheaper somewhere else.
In addition, someone mentioned in a forum that some quirks of Eddie might not be everyone’s cuppa tea. Peep those free webinars of him first, see what’s up. My advice is don’t push it if you don’t like his vibes especially when the mentoring program costs an arm and a leg.
Personally, I won’t be recommending note investing as a business model. Never mind the promise of a discount as buying a note would still cost you lots of Gs like a typical real estate biz does. Too pricey, but then you’re not even sure if it’d turn out to be profitable in the end.
What I mean is two things. One, it’s hard to gauge the real value of a note. Everything could go well with the borrower and the property, and the investor would still get an L because they got fleeced with the amount they paid for the note. Then, there’s the point where something actually goes wrong, which is my second point.
Just like traditional real estate, note investing is inherently risky. Like, an investor could get f*cked in many ways. For instance, a performing note could mean losses when the borrower decides to default on their loan. Anotha one is when the exit strategy for a non-performing note which is putting the property up for a short sale doesn’t get the ideal profitable payout. I rather chill with mah biz rather than play with fire like this, just sayin’.
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