Passive Income via Mortgage Notes with Eddie Speed

The podcast episode of Get Your Fill: Financial Independence and Long Life features host Christine McCarron interviewing Eddie Speed, a veteran with over 40 years in real estate note investing. Eddie, founder of NoteSchool, has purchased over 50,000 mortgage notes and is a leading expert in discounted mortgage notes and seller financing. He explains that owning a note means acting as the bank: investors buy real estate secured notes - promissory notes backed by property - often created through seller financing where sellers finance buyers directly, especially as traditional lending has tightened post-pandemic. This creates about 100,000 seller-financed transactions annually, with notes frequently sold in the secondary market at a discount for lump-sum cash, allowing investors to earn interest, typically 9-11%, without owning or managing property.

Eddie contrasts note investing favorably with rental properties, rent houses, noting that inflation has eroded rental cash flow to around 4% in many markets due to rising expenses like taxes, insurance, and maintenance, while notes offer higher yields with less hassle—no tenants, toilets, or 2 AM calls. He highlights low-risk strategies via his risk blueprint for underwriting -targeting 3-5% default rates, far better than FHA loans at 11% delinquency - focusing on notes with strong equity cushions, often less than 70% loan-to-value, and using third-party servicers for compliance and collections. Leverage is accessible even for beginners with limited capital, including through self-directed IRAs, his wife Martha's "Martha Model" exemplifies this for retirement and legacy building, enabling scaled portfolios with spreads over borrowing costs.

The discussion emphasizes current market timing as ideal for note investing amid rigid traditional underwriting leaving borrowers underserved, e.g., self-employed, immigrants, or those in growing markets like the Hispanic community. Eddie stresses benefits like passive income, easier inheritance than rentals, and tools from NoteSchool, including free training at noteschool.com/fill-starter, to evaluate fit—best for trainable investors open to shifting from landlord headaches to "being the bank." He positions it as a smarter alternative in today's economy, not competing with banks but filling gaps for consistent returns and wealth building.

Connect with Eddie: noteschool.com