You sold a parcel with owner financing last week. You would rather have cash than 10 years of payments. Then a note buyer tells you to come back after the buyer has made a year of payments.
That wait is called seasoning. Here is why buyers ask for it, and how we buy land notes with no seasoning at all, even at the closing table.
What is note seasoning?
Seasoning is the payment history on a note: how many on time payments the buyer has already made.
A note with no payments yet is unseasoned. A note with a year of on time payments is seasoned. The history shows the buyer actually pays, so many note buyers treat it as proof the note is good.
Have a land note to sell?
We pay 80 to 90% of balance, performing or not, no seasoning. Written offer in 24 hours.
Get a Free QuoteSell Your NoteWhy do many note buyers want seasoning?
A brand new note has no track record, so they wait for payment history instead of judging the buyer and the land up front.
Waiting is the easy way to screen risk. The catch is that you carry the note in the meantime, and your money is stuck in it. If you plan to sell your notes, ask a buyer before you close whether they need seasoning. See land note buyer vs. note broker.
Can you sell a land note with no seasoning?
Yes. We buy land notes with no seasoning, at the closing table or years into the payments.
We pay 80% to 90% of the balance. If you tell us about the deal before you close, we can buy the note at the same closing where you sell the land, so you leave with cash that day. See selling land notes at closing and how a note sale closes.
How do you price a note with no payment history?
We judge the buyer's down payment and credit, the land, and the note terms, instead of waiting for payments.
| Buyer's credit | Down payment we look for |
|---|---|
| 690+ | 20% |
| 630 to 689 | 30% |
| 600 to 629 | 40% |
| Below 600 | 50% |
You can skip the credit check with 50% down or a buyback guarantee. Beyond the buyer, we look at:
- The down payment. At least $10,000, with 20% or more standard. Under 20% needs a seller buyback guarantee.
- The land. At least a $50,000 property value, legal access, no substantial wetlands or flood zone, and a perc test on lots under 10 acres.
- The note. A promissory note with a deed of trust or mortgage, at least a $25,000 balance, and a maximum 65% investment to value. We do not buy land contracts.
Takeaway: a big down payment does the job that seasoning does. A buyer with real money in the land is a buyer who pays. The full list is on our note buying criteria.
How do you set up a land sale so the note sells at closing?
Screen the buyer, take a real down payment, use a promissory note, and send us the terms before closing.
- Ask every buyer two questions: how much down, and how is your credit.
- Set the down payment from the table above.
- Use a promissory note and a deed of trust or mortgage, not a land contract.
- Send us the deal before closing. We confirm the price and can prepare the loan documents.
- Close once. We buy the note at closing and you collect the down payment plus the note price.
With 20% down, sellers usually collect 84% to 92% of the sale price at closing. See our seller financing program.
Frequently Asked Questions
What is a seasoned note?
A note with a history of on time payments. An unseasoned note has few or no payments yet.
Can I sell a land note right after closing?
Yes. Damen Capital buys land notes with no seasoning, including at the closing table, for 80% to 90% of the balance.
Why do note buyers ask for seasoning?
Payment history shows the buyer pays. Buyers who do not underwrite the borrower and the land up front wait for that history instead.
What do you need to buy an unseasoned note?
A promissory note with a deed of trust or mortgage, at least a $25,000 balance, a $50,000 property value, at least $10,000 down (20% standard), and a perc test on lots under 10 acres.