The amount of capital needed to start investing in notes can vary widely depending on the strategy you choose. Some investors begin with as little as $5,000-$10,000 by purchasing partial notes or investing in note funds. For whole notes, you might need $25,000-$50,000 or more. However, one of the beauties of note investing is the ability to scale gradually. At NoteSchool, we teach strategies like using self-directed IRAs, leveraging other people’s money, and partnering on deals to help you get started with less capital. Remember, it’s not just about how much money you have, but how smartly you invest it.

While all investments carry some level of risk, note investing can actually be less risky than traditional real estate in many ways. When you invest in notes, you’re not responsible for property maintenance, tenant management, or unexpected repairs. The note is secured by the property, providing collateral. If the borrower defaults, you have options like loan modification or foreclosure to recover your investment. Additionally, by purchasing notes at a discount, you create a built-in equity cushion. At NoteSchool, we teach thorough due diligence processes and risk mitigation strategies to help ensure safer, more profitable investments.

Absolutely! Investing in notes using a self-directed IRA or 401(k) is an excellent way to grow your retirement savings tax-deferred or even tax-free (in the case of a Roth IRA). This strategy allows you to diversify your retirement portfolio beyond traditional stocks and bonds. At NoteSchool, we provide comprehensive training on how to set up and use self-directed accounts for note investing, including strategies to maximize returns and navigate IRS regulations. Many of our students have successfully built significant wealth in their retirement accounts using our note investing strategies.

Performing notes are loans where the borrower is making regular, on-time payments. These provide steady, predictable cash flow and are generally considered lower risk. Non-performing notes are loans where the borrower has fallen behind on payments. While riskier, these can be purchased at steep discounts and offer potential for higher returns through various workout strategies. At NoteSchool, we teach strategies for both types of notes. Performing notes are great for passive income, while non-performing notes can be excellent for more active investors looking to solve problems and potentially acquire properties at a discount.

The timeline for returns in note investing can vary depending on your strategy. With performing notes, you can start receiving monthly cash flow immediately after purchasing the note. For non-performing notes, the timeline can be longer, typically 3-6 months, as you work through various resolution strategies. Some investors see significant returns within their first year, while others focus on building long-term wealth over 5-10 years. At NoteSchool, we teach strategies for both quick wins and long-term wealth building, helping you create a note investing plan that aligns with your financial goals and timeline.

Yes, you can invest in US-based notes even if you’re not a US resident. However, there are some additional considerations and potential challenges, such as setting up appropriate business entities and navigating tax implications. At NoteSchool, we have experience working with international investors and can provide guidance on the best approaches. We recommend consulting with a US-based attorney and tax professional familiar with international real estate investments. Our bootcamp and mentoring programs can be attended virtually, making it accessible to investors worldwide.

The ROI for note investing can vary widely depending on the type of notes, purchase price, and investment strategy. Generally, investors aim for returns in the 8-12% range for performing notes.