By John Alexander
Two Steps are involved in the process
1. Record a notarized "Assignment of Deed of Trust" with the local County courthouse.
2. Have the seller endorse the note over to your name by signing an endorsement on the back of the note document.
3. Have the seller of the note, send an Estoppel letter to the note payer to establish that balance they owe. It can also protect you should there be a disagreement on the balance the payer thinks they owe. Endorsement on Notes To endorse a note, it is done much the same way as a bank check endorsement. In this example,
Bob is assigning his note and mortgage over to Tom Smith. Have the seller fill in the following on the backside of the note:
Oct. 1, 2015 Pay to the order of Tom Smith, a single man. _______________________ Bob Thomas.
An endorsement alone does not stop the “Guarantor” status of the original note holder, in this case Bob Thomas. This means that if the note is not paid by the payor listed on the note, the note holder (Bob Thomas) must make the payments. It works much like a co-signor would. If you are the note holder and you want to sell or transfer a note to another person, always include these extra words to eliminate the guarantor status and protect yourself from certain legal problems that could arise.
Oct. 1, 2015 Without Recourse, pay to the order of Tom Smith, a single man. ___________________________________ Bob Thomas