Losing It All In The 2008 Real Estate Crash To Note Investing Success With Non-Performing Notes

In the realm of real estate investing, traditional methods often demand a significant amount of time and effort. However, the allure of real estate as a wealth-building tool remains undeniable. This is where note investing emerges as a captivating alternative, offering a pathway to enhance wealth without the burdensome responsibilities typically associated with traditional real estate ventures.

I had the chance to speak with Lisa Hylton, host of the Level Up REI Podcast, to discuss Note investing (with non-performing notes) and how anyone can get started!

We covered a lot of ground including:

  • Why understanding your personal investment goals and risk tolerance is crucial in real estate investing.
  • Why due diligence, including property valuation, lien checks, and market analysis are essential in Note investing.
  • Ways that Note investing offers opportunities for creating cash flow without the challenges of traditional property ownership and management.
  • The unexpected reward that can come with Note investing when you are able to help families stay in their homes.
  • How Market conditions, such as interest rate changes and foreclosure trends, can impact the profitability of Note investments.

Key Moments: 

07:12  From Loss to Lesson: How the 2008 Crash Shaped My Real Estate Journey

10:38  Mastering Real Estate Investing Through Notes: A Deep Dive into Non-Performing Notes

20:20  Making Money with Non-Performing Notes: A Comprehensive Guide

28:40  Mastering Note Investing: Capital, Due Diligence, and Rewards

37:58  Why Investing in Notes is a Rewarding Opportunity in the Current Market Environment

42:14  Unlocking Success in Real Estate Investing and Entrepreneurship

46:18  Insights on Real Estate and Entrepreneurship: Key Lessons and Tips from an Experienced Investor

The Evolution from Traditional Real Estate to Notes

My foray into real estate was serendipitous, propelled by circumstances rather than choice. Early on, I navigated the complexities of inherited assets submerged in debt. With a lot of persistence and strategic decision-making, I not only cleared the debt, but also ventured into construction and development, immersing myself in the real estate landscape.

Lessons Learned from Adversity

My journey is marked by a significant financial loss of $20 million, however it served as a profound learning experience. The crash of the real estate market tested me, yet it was this adversity that sculpted me into the seasoned investor I am today. The setback, albeit daunting, unveiled my risk tolerance, money management skills, and reinforced my drive behind ethical investing.

The Rise of Note Investing

I found my niche as I transitioned from traditional real estate to Note investing. Investing in non-performing notes presented a unique opportunity to leverage distressed assets at discounted rates. I found that by focusing on non-performing Notes, I could not only create equity but also extend a lifeline to borrowers facing financial challenges. Having been there myself, this fueled me even further.

Key Elements of Note Investing

There are 3 important elements when acquiring non-performing Notes: deal sourcing, due diligence, and funding.

When looking to acquiring non-performing notes you need to be able to source the deal. This can happen in a number of ways including, but not limited to, networking with banks, hedge funds, note brokers, and other investors to discover profitable note investment opportunities. 

Due Diligence is the extensive evaluation of the asset, which includes a minimum of: property inspection, valuation, lien verification, and comprehensive research on the asset’s history. 

Funding: Note investing necessitates capital. There are many types of funding you can use either self-funded, through joint ventures using other people’s money, and Note investing is the perfect vehicle for self-directed IRA funds, whether yours or someone else’s.

If you master these 3 elements you will be able to reap the unparalleled benefits of Note investing.

Benefits of Note Investing

There are many benefits to investing in non-performing Notes. One of the biggest benefits is that there is an inherent risk mitigation when you are purchasing non-performing Notes because you are buying Notes at a discount based on current market value. In buying the Notes at a discount, it minimizes speculation and offers an equity cushion. Non-performing Notes allow you to generate chunks of cash and recurring monthly cash flow without the hassles of traditional property ownership and management. There are various exit strategies, including borrower re-performance, property possession, or resale, offering diverse avenues for profit. This allows for a level of flexibility that other real estate ventures do not provide. 

Challenges and Opportunities

The current real estate climate, with rising interest rates and inflation, presents both challenges and opportunities for Note investors.

Increasing foreclosure rates post-pandemic unveil a surge in distressed assets, creating a fertile ground for Note investors to capitalize on emerging opportunities.

Empowering Investors with Knowledge

By delving into the world of Note investing, you can unlock a wealth-building avenue that offers unique advantages and opportunities for financial growth and impact.

Remember, real estate investing, particularly in Notes, is a journey that demands resilience, due diligence, and a deep understanding of personal objectives. By immersing oneself in the nuances of Note investing, investors can carve a path to financial success while positively impacting the lives of borrowers in need.


Get the 411 in this quick easy-to-digest video series, so you have a more comprehensive idea of what it is and if it’s the right next step for you.




Paige Panzarello is the “Cashflow Chick”. Having been a Real Estate investor and entrepreneur for almost 25 years, Paige has experienced many facets of real estate investing. Her experience includes founding and running her own Residential and Commercial Construction and Acquisition companies, Buy and Hold residential and commercial real estate investing, Tax Deeds/Liens Investing, Fix and Flip (Residential Remodeling), and other forms to name a few. She currently focuses on Non-Performing Notes that she purchases all across the United States. Whether in notes, residential or commercial real estate, in California, Arizona, or nationwide, Paige has been successful in completing over $150 million in real estate transactions to date.

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