He found a private investor, Mrs. Gable, who had lent $50,000 to a fix-and-flip artist three years ago. The flipper had vanished, the house was rotting, and Mrs. Gable was tired of the taxes. She held a "performing note" that had gone "non-performing."
You aren't buying the note; you are buying the contract to buy the note, then selling that contract to someone with cash.
Elias walked away with $5,000. He had "bought" the note and sold his interest in it without ever touching his own bank account. He took his $5,000, went back to his spreadsheet, and looked for the next zombie. Key Takeaways for Your Draft
Elias had exactly $42 in his bank account. To buy a note, he didn't need cash; he needed a and a wealthy partner .