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Note Appraisal Services
Jeff Armstrong provides Nationwide Valuation Appraisal Services for Secured and Unsecured Promissory Notes. If you need a Valuation Estimate or an Appraisal of today's cash value of your secured or unsecured notes, for the purpose of Estate Planning, Financial Planning, Income Statement Preparation, Balance Sheet Preparation, or any other purpose we invite you to contact us today.
"Jeff, I just wanted to express my appreciation to you for your assistance, promptness, and expertise in providing me with an excellent professional appraisal. I won't hesitate to recommend your services to others."
~ Elizabeth P.
Why a note or cash flow appraisal?
For the following reasons (and more):
- Estate Planning
- To save you or your clients from overpaying taxes.
- A note in an estate being probated may need to be appraised.
- Notes invested in a pension/profit-sharing plan may need annual valuations.
- A client may be receiving payments from a personal injury settlement.
- Perhaps one party in a divorce settlement accepted a note as his or her share.
- When a client needs to sell part or all of a note for cash, he or she may want an independent source to set a price on a note. The math is only a part of the valuation process.
What are some examples of note appraisal situations that we can help with?
Secured or unsecured notes Real estate notes
Business notes with/without real estate Performing notes
Seller Carryback notes from sale of real estate Discounted notes
Seller Carryback notes from sale of a mobile home Non-performing notes
Promissory Notes–Trust Deeds–Mortgages Defaulted notes
Personal notes Inheritances
Gift notes Estate notes
Bank notes Probate notes
Commercial notes Intra-family notes
Divorce notes Installment notes
Property settlement notes Demand notes
Partial Interest notes Royalty payments
Lottery winnings / structured settlements...and more.
TWITA! Thank you for your Note Appraisal. Your level of professionalism, responsiveness and knowledge of the industry is truly outstanding.
~ Jacek N.
What determines the value of a cash flow or a note?
Many considerations are taken into account when determining the vale of a note or cash flow, such as:
- Equity in property securing the note
- Payment history of payer
- Priority of debt
- Type of property
- Condition of property
- Note terms
- Credit of payer
- Value of the collateral (if any)
- Property location
What is the “Fair Market Value” of my note based upon the definition used by the IRS?
If you own all, or part of a promissory note or a mortgage note, the question you should ask yourself is this, "Is my note properly valued, or is it over-valued?" Over-Valued Notes will cost you needless fees and taxes. Let’s be honest, all note investors want their promissory notes and mortgage notes to be worth as little as permissible for tax purposes, but worth as much as possible for spending purposes.
Rev. Rul. 67-276, 1967-2 CB 321, IRC Sec(s). 2031 says that the fair market value of notes, secured or unsecured, is presumed to be the amount of unpaid principal, plus accrued interest to the date of the gift, unless the donor establishes a lower value. Unless returned at face value, plus accrued interest, it must be shown by satisfactory evidence that the note is worth less than the unpaid amount (because of the interest rate, or date of maturity, or other cause), or that the note is non-collectable in part (by reason of the insolvency of the party or parties liable, or for other cause), and that the property, if any, pledged or mortgaged as security is insufficient to satisfy it.
Armstrong Capital offers consulting regarding the best way to structure the promissory note transaction so that the outcome sought has the highest probability of being accomplished. Confidentially and privacy respected and protected
"Thanks Jeff, your appraisal was extremely helpful for the conversion of my IRA! I appreciate your diligence and thoroughness."
~ Noel S.
Can you appraise Self Directed "Checkbook" IRA LLCs, Alternative Assets and Non-Traditional Assets?
Yes! One of the requirements that the administrator of your checkbook IRA account places on you is that you must submit a fair market valuation of assets owned by your IRA annually. A value of each asset within the LLC is required in order to determine the value of the LLC. Real estate asset, promissory notes, private placements, tax certificates, tax deeds, etc. are each specific types of assets and must be appraised by a qualified third party appraiser using the same standards as it would use if it were directly owned by the IRA.
Other assets, such as bank or brokerage accounts should have year end statements proving their value and will not require a third party appraisal.
Who is responsible for providing the third-party appraisal of the checkbook LLC assets?
The IRA account owner is responsible for obtaining the appraisals. The IRA is responsible for paying the appraisers. A short explanation why the appraisals are required: “it’s the law”.
How often is the appraisal reports required?
What are some examples of Alternative Assets or Non-Traditional Assets?
Promissory Notes–Trust Deeds–Mortgages
Business Notes and Personal Notes
Limited Liability Companies (LLC)
Internal Revenue Code Section 408(a)(3) TITLE 26, Subtitle A, CHAPTER 1, Subchapter D, PART I, Subpart A. is the controlling IRS Code Section.
How much do Note Appraisals cost?
If you want a professional note appraisal done by an experienced, qualified appraiser of course it will cost something just like if you wanted to get an appraisal on a home or other piece of property. It cannot be done for free. Just as the electrician or the plumber cannot do their jobs for free. But, there are different levels of appraisal reports that used different levels and types information. Based upon the type of appraisal you need, and the amount of detail that you need, there are different prices charged. Just as GM makes the Chevrolet and the Cadillac model cars, and charges accordingly, different models of appraisal reports can be done, and are charged accordingly.
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Last edited: 12/01/15 06:41:00 PM