Jay Redding has been investing in real estate since 2004, completing over 100 flips and building a rental portfolio before eventually shifting his focus toward note investing. As margins tightened in the fix-and-flip market and operational headaches increased, Jay and his son-in-law Kyle began exploring the note space more deeply.
They discovered that by helping investors structure seller-financed deals correctly, those investors could later sell part of the note and quickly recover capital to fund additional deals. Instead of holding a property long-term, investors could create a performing loan and sell a portion of the payment stream to a note buyer.
Jay explains how partial note purchases work, what note buyers look for, how to properly structure a note, and why interest rates, down payments, and servicing all play a critical role in the resale value of a note.
The discussion also highlights why many investors unknowingly create “bad notes” that force them to take deep discounts when selling. By structuring notes correctly from the beginning, investors can recover capital faster while still earning long-term income.
The episode closes with insights on the changing real estate market, shrinking flip margins, and why notes may be one of the best ways to generate long-term generational wealth.
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📘 Overview
In this episode of the Generations of Wealth Podcast, Derek sits down with real estate investor and note expert Jay Redding to discuss a powerful but often overlooked strategy: creating and investing in real estate notes.
Jay shares how he transitioned from fix-and-flips and rentals into the note business and why notes can produce significantly higher cash flow with fewer headaches than traditional rentals.
The conversation dives into structuring seller-financed deals, selling partial notes, recapitalizing deals, and how investors can create long-term wealth by becoming the bank instead of the landlord.
For investors frustrated with shrinking flip margins or the grind of managing rentals, this episode opens the door to a completely different strategy.
⭐ Key Takeaways
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Flipping margins have tightened significantly in recent years
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Seller financing creates additional exit strategies for investors
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Notes can generate 2–2.5x more cash flow than rentals in many cases
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Properly structured notes retain significantly more value when sold
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A partial note sale allows investors to recover capital while keeping future payments
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Down payment size greatly affects note value and risk
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Interest rates around 11–13% are common in investor-created notes
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Notes should always be serviced by a licensed loan servicing company
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Many investors lose money because they structure notes incorrectly
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Seller financing can help investors survive slower markets
💬 Relevant Topics Discussed
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Transitioning from flipping to note investing
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Partial note purchases explained
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Seller financing strategies
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Structuring notes for resale
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Down payment and borrower qualification
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Loan servicing and compliance requirements
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Interest rates and note discounts
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Market shifts affecting flippers
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Recapitalizing deals to fund new investments
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Portfolio optimization and “culling the herd”
🎧 Why Should You Listen?
Listen to this episode if you:
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Flip houses and want additional exit strategies
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Are tired of managing rentals
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Want higher cash flow with less operational stress
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Are curious about becoming the bank instead of the landlord
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Want to learn how to structure seller-financed deals properly
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Are interested in long-term wealth strategies
Jay breaks down the note business in a practical, real-world way that investors can apply immediately.
Important Links:
About Jay Redding
Jay Redding is a seasoned real estate and mortgage note investor with more than 20+ years of hands-on experience building cash flow across multiple strategies. His background includes completing over 100 fix-and-flip transactions, owning and managing up to 45 single-family rental properties, and investing in tax liens, private lending, self-directed IRAs, and mortgage notes.
Jay and his Son-in-Law Kyle focus on helping real estate investor’s structure smarter exits by creating quality installment sales and mortgage notes that perform and that note buyers actively seek in the secondary market. His approach helps investors recapitalize, improve liquidity, and continue growing their businesses while building long-term, predictable income.
Jay shares practical frameworks and real-world insights investors can use to structure deals correctly from the start, protect cash flow, and turn today’s transactions into tomorrow’s wealth.