Note servicing


#1

Do any of you run, as a seperate LLC or business, note servicing? My partner and I have been thinking about starting one so we can charge a $500 note servicing charge and then $5.00 per month added to payment charge on our notes. This would also appear to the home purchaser that an outside company, which it technically would be, is handling the payment processing and then sending the mortgage payment to us and keeping track of the escrow amount. We have both been in the automotive business for 15+ years so I called our state dealer investigator to find out what fees we could charge since these are sold the same as a car. Any thoughts on this for a way to increase the sale amount of a deal as well as the monthly payment plus give additional business deductions???

John


#2

Yes we do this. Having a separate company to service notes is important depending on what states you live in.

I would encourage you to review ORIGENs business model as they do servicing on a large scale.

There modeling might help you get specific answers.

Your fees sound about right.