Selling mortgage notes

Partial note sale: selling part of your payments

Updated 2026-10-19

In a partial note sale, you sell a buyer the right to a set number of your note's upcoming payments, for example the next 60, in exchange for a lump sum now. After the buyer has received those payments, the rest of the note comes back to you. You get less cash than in a full sale, but you keep the later payments.

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How a partial works

You and the buyer agree on what's being sold: usually a number of consecutive payments, sometimes a dollar amount or a share of each payment.
The buyer prices that slice of the payment stream at the yield it needs.
At closing, the note and the mortgage or deed of trust are usually assigned to the buyer, with a written agreement that gives them back to you (a reversion) once the buyer's payments are made.
The borrower pays the buyer or its servicer during the buyer's period, then pays you again.

Exact structures vary by buyer. Read the agreement closely: it controls what happens in every scenario below.

Example: the math behind a partial

Illustration only, not an offer or a market rate. A note pays $700 a month with 180 payments left.

Option	Payments sold	Value at a 10% yield	What you keep
Full sale	All 180 ($126,000 in total)	About $65,140	Nothing after closing
Partial	Next 60 ($42,000 in total)	About $32,946	Payments 61 to 180 (120 × $700)

The partial brings in roughly half the cash of the full sale here, and you keep $84,000 of later payments. Try your own numbers in the estimator by entering only the payments you'd sell. Real pricing depends on the note, the borrower and the buyer.

When a partial makes sense

Partial sale	Full sale
You need a set amount of cash, not the most cash possible	You want the most cash now
You'd like income again later	You want to be finished with the note
The note has a long time left to run	Few payments remain
You're comfortable keeping some exposure to the borrower	You'd rather hand all the risk to the buyer

Questions to settle before you sign

Default: if the borrower stops paying during the buyer's period, who decides what to do, and how is any recovery split?
Payoff: if the borrower pays the loan off early, how much goes to the buyer and how much to you?
Servicing: who services the loan, who pays for it, and do you get statements?
Reversion: how and when are the note and lien assigned back to you?
Taxes: a partial can change how and when you report income. Ask a tax professional.

Questions

Can I sell just part of my mortgage note?

Often, yes. Many note buyers will buy a set number of upcoming payments instead of the whole note. Say so when you request a review.

Do I get the note back after a partial sale?

Usually. The agreement typically returns the note and the lien to you after the buyer receives the payments it bought. Check exactly how that happens.

Is a partial sale priced differently?

It's priced the same way, as the present value of the payments being sold at the buyer's yield. Because fewer payments are sold, the lump sum is smaller.

What happens if the borrower pays off early during a partial?

The agreement decides. Typically the buyer receives what it's owed under its share and the rest goes to you, but terms vary.

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