It has everything to do with asking a better question. Here’s the question: Who are you financing? Think about it. Every month, you make mortgage payments, car [00:01:00] payments, credit card payments. Somebody is collecting that interest. Somebody’s money is working while they’re sleeping. Now, here’s the part that hits a little differently.

Most people spend their entire lives becoming incredible at making money, but never become intentional about making their money make money. I was talking to my real estate awesome sauce coaching client out in Los Angeles. She’s fantastic realtor, hard worker, long hours, crushing deals, but she kept telling me, “Ferg, I just need a few more closings.”

I finally stopped her and said maybe you don’t need more closings. Maybe you need your closings to start buying your freedom.” See, that’s a different conversation. Instead of every dollar going toward bigger lifestyle, what if a few of those dollars were recruited to go to work? What if every commission check had employees?

Because dollars that sit around eventually disappear. Dollars that are deployed have potential to come back with friends. The goal isn’t just to earn more. The goal is to build a life where your money starts carrying part of the load, so your future isn’t completely dependent on your next paycheck, your next commission, or your next deal.

That doesn’t happen overnight. It happens decision by decision, or I like to say inch by inch, it’s a cinch. Habit by habit, investment by investment, [00:02:00] and that’s exactly why I’m excited about today’s guest who’s built a career helping people stop thinking only like borrowers and start thinking like leaders.

And his name, he flew in here from Philadelphia, Fred Moskowitz, and if you’ve ever wondered how the wealthy create cash flow outside the stock market, lean in right here. Fred is a best-selling author, educator, speaker, entrepreneur, and veteran in the mortgage note investing world. He teaches everyday investors how to step into the shoes of a lender and, as he says, “Be the bank.”

As a fund manager, Fred manages a mortgage note company fund that helps investors understand how notes can create passive income, diversification, and cash flow backed by real estate collateral. In his book, Little Green Book of Note Investing, which I’m gonna have a two-book giveaway at the end, squad so sit tight and listen to what he has to say.

That book breaks down how to analyze notes, manage risk, u- use retirement accounts, and understand note funds without needing Wall Street to be your only path. He’s not here to throw theory at us. Fred brings real-world experience, straight talk, and actionable knowledge nuggets on building wealth through alternative investments and I [00:03:00] just know that I lean on him quite a bit pretty much every week as I dive into my note investing.

Fred, you know what? So before we dive into note investing What’s one thing people are always surprised to learn about you that not, has nothing to do about money or investing? 

Fred Moskowitz: For me, I really love what you started with, talking about having options and not obligations. That is an amazing goal to have- Right

in life. That’s my definition of success, man No matter what we do. Everything we do. 

Coach Fergie: Yeah. 

Fred Moskowitz: Having options, an abundance of options, is always the best thing to pursue- Love it … and the area to focus on. 

And then from there, you can explore, you can lean into curiosity. 

Coach Fergie: Yes. 

Fred Moskowitz: You can, Y-

try different things. You fail. You’ll fail at some. 

Coach Fergie: Sure. 

Fred Moskowitz: You will excel at others. You’ll discover some things that you love, and other things that you say, “You know what? This isn’t for me.” “Or [00:04:00] this isn’t gonna work.” 

Coach Fergie: I love 

Fred Moskowitz: it. And that’s all part of this experience. But we 

Coach Fergie: can’t have it unless we have- 

Fred Moskowitz: Yeah

Coach Fergie: the wherewithal to be able to for lack of better term, pay for it, right? I believe that success is living a life of options, not obligations, right? 

Fred Moskowitz: Absolutely. 

Coach Fergie: And but also doing it in the service of people that love what you do, meaning I love what I do, and I do it in the service of people who love what I do.

They see that I love coaching. They see it, so they really lean into it. You are awesome. I’ve read the stories, and you’ve told me stories about you in, peop- not sweating losing your job or anything, and people approaching you like, “Dude, what’s going on?” “How do you do this?” And started introducing people a little bit to the note world, right?

Fred Moskowitz: Yeah. 

Coach Fergie: So explain in, I’m a 12-year-old, and tell me what a note is and how that is important in everybody’s world. 

Fred Moskowitz: Sure. With, what is a note? In the context of our conversation, it refers to a re- we’re talking about real estate, notes and mortgages, which is the debt used to [00:05:00] finance and acquire properties.

Here in the US, the majority of people, when they go out and buy their home or buy an investment property, they’re gonna utilize some kind of financing- Yes … which puts leverage on the transaction, and it allows you to purchase a property with just a fraction of the amount needed of the purchase price.

And the rest is debt. And so that’s great. It’s a fundamental part of real estate transactions. Now, for us as investors, there’s an opportunity to purchase those loans and own them, and it’s not something that’s limited to just banks and lending institutions. But for individual investors, for small companies, can go out and purchase these loans on the secondary market.

Most people- Have experienced the [00:06:00] secondary note market from the perspective of, if you’ve ever gone and purchased a p- a home or refinanced maybe, you sign all the t- loan documents at closing. Yes. And then within just a couple of months, maybe a month or two or three- … you get that letter from the bank- Who’s gonna pay?

that says, “Dear Mr. and Mrs. Homeowner, we’re writing to let you know that your loan is being sold, and starting next month, please make your payments to the new lender.” “Here’s their address, their contact information. And by the way, don’t worry, none of the terms and conditions of your loan will change.”

Will change. And so this happens- All the time … every day. It’s pretty much- Yeah … these days it’s a regular part of the real estate transaction. 

And so that’s the secondary market at work. Your loan got sold. You as the borrower have no say in, in the- … in the matter. No control there except [00:07:00] your lender is obligated to that contract, that note, the mortgage.

To let you know who 

Coach Fergie: to pay it to. 

Fred Moskowitz: Yeah. That, that’s- And- … the legal- 

… 

Fred Moskowitz: Contract that was entered in. 

Coach Fergie: And Squad, what, w- when Fred there, a lot of people think that you’re paying your mortgage. When you say, “I gotta pay my mortgage,” you’re actually paying the note that’s attached to your mortgage.

The mortgage is actually the collateral. The house is the collateral, that if you don’t pay that note, the bank gets it. Fred? 

Fred Moskowitz: Yeah. The mortgage is what’s called the security instrument, and this is the document that when you sign it, you are giving A security interest up to the lender as collateral for the money that’s being borrowed.

That then is gonna get recorded on in the public record at your county courthouse- … so that there’s now a lien against the property. And if the property is ever sold or conveyed or refinanced- Sure … where you need clear title, that lien is gonna have to be addressed. 

And so this is how the lender ha- is secured [00:08:00] for whatever the loan amount is- Right

that they lent, and that protects their investment. And this is one of the compelling reasons for investors to be able to purchase a note, because when you buy a note that exists already, it’s gonna be, come with that security interest backing your investment. 

And so that’s a tremendous amount of security.

If you were to go out invest in a mutual fund or invest- Sure … in a stock you’ll own shares, but there’s really nothing backing your investment. If the company declares bankruptcy or goes under- Sure … lose it all. 

But with a note that’s secured by a mortgage, there’s always- something backing your investment. And so that provides a lot of downside protection for the- To the bank … to the bank or to the- … to you as the investor. 

Coach Fergie: So you’re telling me that me as just a regular citizen can actually purchase a, the promissory note, if you [00:09:00] will, for a house that’s secured by real estate?

Fred Moskowitz: Yes. 

Coach Fergie: Okay. Gotcha. And, a lot of people will say, “Oh, I’m a real estate investor, and I got this many doors,” which I, you know me. Yeah. I have that, right? And but it’s, the, with the note investing, it’s not as, quote-unquote, sexy, right? ‘Cause you don’t have that real estate that, that backs it.

Yeah. So if you were talking to somebody f- maybe for the first time about the benefits of investing in notes, what would you tell them? ‘Cause m- this is what I say, real quick. There’s no Ts. Tenants, taxes, trash, toilets- … and stuff like that to deal with. But what do you kinda tell people? 

Fred Moskowitz: What I tell people in simplest terms is that this is a great way for someone to invest in real estate without having to own and manage rental properties- without having to handle repairs or deal with- … tenants. Yes. You’re, you … That’s a big distinction. And- The difference [00:10:00] there is it’s a lot less hands-on. Owning properties, owning real estate- … is a great way to build wealth. It really is. Oh, 

Coach Fergie: yeah. 

Fred Moskowitz: However, there’s a lot of work involved. 

And if you’re willing to do that work, that’s great.

You can build amazing wealth, especially over the long term. 

What I’ve learned with note investing, it’s still in real estate. It’s a little bit different. It offers some diversification as well. Yeah. But what I really love is that it’s something you can scale- 

Coach Fergie: Oh my gosh, 

Fred Moskowitz: yes … very large if you want.

Coach Fergie: Yes. 

Fred Moskowitz: Or stay small, but it’s a, it’s not hands-on. It’s not hands-on, and so you don’t have the headaches. You don’t have to worry about, oh, a roof is leaking on this property and you have to handle getting that repaired. Or the air conditioning compressor failed and it has to be replaced.

Those responsibilities all fall on the homeowner. 

And so that’s a [00:11:00] huge mindset shift there. 

Coach Fergie: And I love it. And again, it’s the joke of the Ts, right? Yeah. The trash, taxes, tenants, and stuff. You don’t have to deal with those, people, squad, as much as … you have your note. The people pay your note, and it’s usually paid to a servicing company, which we’re not gonna get too deep into that jargon because Fred has it in his book, The Little Green Book of Note Investing.

But and you actually saved me a little bit a little bit ago. You’re like, “Dude, if you’re buying that note there, you need to have servicing company.” Yeah. Yeah. Let’s, let’s- It was like, I’m like, “Wait a minute, you’re right.” Yeah. 

Fred Moskowitz: Let’s unpack that a little bit. A servicing company is gonna be responsible for managing the hands-on activities of the note.

It’s like a property 

Coach Fergie: manager 

Fred Moskowitz: for a note. Exactly. Yeah. That’s the analogy. The same way a property manager manages a rental property, the note servicing company, they’ll manage the note on behalf of the lender. They’ll handle collecting the payments, keeping track of the accounting. If they’re 

Coach Fergie: late.

Fred Moskowitz: If there’s … If the loan is gonna be paid [00:12:00] off, they’ll prepare the payoff quote- Sure … and coordinate that with the title company. So they handle even the tax forms that have to be sent out at the end of the year. They take care of all that for a very low fee, and so it’s really takes away a lot of the administrative burden of being a lender.

Coach Fergie: Love it. And squad, we’re gonna really dive deep into what Fred has for programs available for possible investing and also more on his book, The Little Green Book of Note Investing, just as soon as we get back from Steve Awesome, my Awesome Sauce sponsor from Rise Mortgage. Gives us a market update and a mortgage knowledge nugget.

We’ll see you in a bit.

Steve Austin (Show Sponsor): Thanks, Scott. Happy Saturday, everyone. This is Steve Austin with the Rise Mortgage Dynamic Team with your mortgage tip of the week. The summer competition is heating up. We are seeing more and more buyers getting into the house hunt this summer, which means preparation is even more important. Getting pre-approved is only a piece of the puzzle.

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Coach Fergie: And thanks again, Steve. And we’re back with my good friend, Fred Moskowitz, the author of The Little Green Book of Note Investing and we’re gonna dig in a little bit to that now, squad out there. But Fred, interest rates have changed dramatically over the last few years, right? From your perspective, like, how is today’s lending environment create opportunities for people like us, or more that didn’t exist like before?

Fred Moskowitz: Yeah, that’s a great question. So the [00:15:00] changes in interest rates it- the impact that it has it impacts the pricing of notes when you buy them and so the interesting thing that happens is for someone that already owns a portfolio of notes- It’s not impacted so much by interest rate changes- Thank you

because the notes have an interest rate set in the contract, and that doesn’t change. But what does change is if you were going to sell that note, which you can always do, or purchase a new one, change in interest rates will impact pricing- Impact 

Coach Fergie: it, yes … 

Fred Moskowitz: at the time. And so that’s the distinction there.

And so always, there are always notes available to buy. It’s always quite easy to sell a note. 

Coach Fergie: Sure. 

Fred Moskowitz: And so that’s the dynamic 

Coach Fergie: there with the- If you know the, how to do it, of course. 

Fred Moskowitz: It is all about having a network of other [00:16:00] investors to work with, to talk to. Purchasing notes, it requires building relationships.

And through that, you have access to be able to buy notes or to sell notes- Got it … to other investors- Got it … to facilitate transactions. A lot of this business is relationship based. So I always say if you’re interested in participating in note investing, one of the most important skills to work on is building relationships.

Thank you. Thank you. 

Coach Fergie: And 

Fred Moskowitz: frankly, that applies to just about any business. Anything in 

Coach Fergie: the world. 

Fred Moskowitz: Any business you do. 100%. Yeah. 

Coach Fergie: And I speak on stage a lot with the networking and how to network, and a lot of people are like me,” where let’s maybe see where you can help somebody else in the room, right?

And I don’t wanna take this whole conversation that way, but you hit- No … the nail on the head. To build your net worth, you have to build your service to others and build that community, correct? 

Fred Moskowitz: Absolutely. 

Coach Fergie: I love it. Yeah. I love it. Which part of the mortgage do you, or [00:17:00] note investing, do you really lean into the most?

Are you like the main mortgage, the second mortgage? Which one do you kinda lean into the most? 

Fred Moskowitz: What I like to focus on is residential mortgage notes. Because there are many different types. There’s commercial, there’s notes on commercial properties, residential properties. I like to focus on residential because that’s what’s most available.

There- Yep. Yep … think about it, there’s most homes in the US- Sure … a lot more than there are commercial properties. And so that’s what’s available is, and based on the relationships I have as well. I like to buy notes on good quality properties that are performing well, that have a good track record, and that’s the way to really have a perf- portfolio that is stable- 

Coach Fergie: Sure

Fred Moskowitz: and consistent. 

Coach Fergie: How about people that again, Squire, it would be called non-performing notes. Like, how about the non-performing, meaning they haven’t been paying [00:18:00] their mortgage. And, full disclosure, that’s what I really lean into. Yeah. The second positions that are not paying. But I also make sure the first position’s being paid, their cars, their credit cards, all that stuff.

They just decide not to pay the second and restructure with a loan modification, right? What’s your thoughts? 

Fred Moskowitz: Yeah. That’s a different side of the business. For me, I have been focusing on notes that are performing and- doing well, and that’s been what’s most available- 

… 

Fred Moskowitz: In the marketplace for me over the past number of years.

And so that’s the area I’ve been focusing on. But like any business, any investment activity, there’s always shifts in the marketplace. And so it’s important to stay in tune with changes that are happening and what’s happening. A lot of this is based on the real estate market cycles, frankly.

‘

Coach Fergie: Cause right now it’s June of 2026 and the rates are what people think are high. I’ll … Back in the ni- late [00:19:00] 90s, early 2000, I would’ve took 6% rate all day long. 

Fred Moskowitz: Yeah. 

Coach Fergie: And just been happy with it, all the way to the bank. And then of course what happened in, up to 2008 where you pinkie promise, you make $250,000 and you have a pulse and you’re just getting a mortgage.

But, like, how about you? 

Fred Moskowitz: Yeah. I’m in the same boat. I purchased my first home around that same time and I remember it was a 7.5% interest rate. And it was a great rate at the time. It was a great rate. And it allowed me to buy the home, and I enjoyed living there, and it was all fine.

And so it’s, … It’s something that I feel that people pay f- sometimes focus on to an excess. 

And,

Coach Fergie: No, and everything’s cyclical. You can- It 

Fred Moskowitz: is … 

Coach Fergie: get out of it if you … Or, not get out of it, but refinance or make- Yeah … things a little bit easier on you, right? 

Fred Moskowitz: Yeah. Ab- absolutely.

Yeah. And I have some real estate that has high interest rate loans on it- Sure … from many years [00:20:00] ago. Yeah. And if you were to look at it on the surface like, oh, I’m paying this high rate on a mortgage, but then you look back and say, yeah, but the loan balance is very small. So when you look at- and you’re really far into that loan- Yeah … when you look at how much money are you paying in interest, you realize, oh, most of the payment’s going to principal anyway- … by this point. So it’s not something to worry about too much. 

Coach Fergie: Gotcha. Yeah. And the … I see there’s a, like a … When I bring it up to people, about, “Hey, have you invested in notes,” and stuff like that, there’s a huge misconception.

Yeah. That note investing is only for institutions, millionaires, but what’s the smallest amount of money that somebody, if they were to get educated, they can realistically get into in buying their first note? 

Fred Moskowitz: When someone’s looking to get involved in note investing, there’s two approaches to it, and what I always talk about is- Think about how much time do you have, how much [00:21:00] time do you wanna devote to this business, to this activity.

If you have a lot of time, you can really get involved in note investing, purchasing notes, building a portfolio, analyzing them. And that’s great. It’s a great business But it’s not for everyone. Maybe everyone just not, you don’t have all of that time. Sure. And so for someone that is busy, maybe you’re busy in your career working as a professional or- a business owner, and you’re focusing on your business, and you don’t have a lot of time, you can invest in a note fund. And a note fund is where it’s managed for you. The fund managers go out, they raise capital, they’ll purchase the notes in bulk quantity, and when they do that, by the way, they’re able to negotiate better pricing on those acquisitions.

Sure. And then they’ll manage the portfolio and pay off a passive return to the investors. So for someone that doesn’t have a lot of [00:22:00] time and they’re looking for a passive investment, it can be a great option. 

And so both ways can be great. It comes down to your personal situation. Do you have a lot of time or very little time?

And so that’s always the first place to start. Now, back to your original question about the amounts, it’s all across the spectrum. 

There are loans with, very small loans with $5,000 loan balance all the way up to million dollars- Million dollars, sure … on a jumbo loan. And so it comes down to your capital, what you have available, what you want to invest.

And you can sh- get started with very small notes if you wanted to. But one thing that I learned, and I talk about this in my book, I learned very quickly that if you invest money in a small note- 

… 

Fred Moskowitz: Then it’s the same amount of work, effort, due diligence- … [00:23:00] and fees- Yes … and expenses on your servicing and other costs- as it is for a very large note. And so you wanna be mindful of that because I learned very quickly that, hey, I don’t like these small notes so much because the same amount of man hours, work, and- Sure … expenses could go towards a a larger- Larger … note. 

… 

Fred Moskowitz: And end up with a lot better 

Coach Fergie: results.

But you can get comfortable with, you can absolutely buy a smaller note. Absolutely. Which I love that- Yeah … that there’s that entry that, that people that can, if they wanna, quote unquote, “get their feet wet” in- Yeah … in a sense, that you have that. And as we’re rolling up on the end of our little chat here, which I wish I could go on forever and ever with you, but The Little Green Book of Note Investing, like you wrote that a couple years ago, I believe.

Fred Moskowitz: Yeah. 

Coach Fergie: And it’s been the best-selling and it’s a amazing book. I’ve read it tw- Two, two and a half times. 

Fred Moskowitz: Wow. 

Coach Fergie: It’s it’s amazing just because there’s little bits I pick up. But we gotta be quick on this, but tell us a little bit about the book and what you offer in there. 

Fred Moskowitz: Yeah. Thank [00:24:00] you. In the book, I- Yeah

set out to provide high level overview of note investing for the beginner. What is note investing? How-

Coach Fergie: If you’re a beginner, squad, you will learn. It’s written amazing. Sorry- Yeah … to cut you off there, buddy. 

Fred Moskowitz: It’s all about what is note investing, why do notes get sold, how to analyze them, how to decide if you wanna be an active investor or a passive investor, and one of my favorite topics is how to leverage your retirement accounts.

Yes. Because this is a powerful strategy. You can utilize the capital in your retirement account, which by the way, a lot of people that I speak with, they have idle cash sitting in an old IRA- they need deploying … or 401. Yeah. And they really didn’t know what to do with it. This can be a great thing to consider.

And those are some of the main topics I cover- It’s amazing … in the book. 

Coach Fergie: Yeah. It’s amazing. I’m gonna do a two-book giveaway. The first two people that text they text it to [00:25:00] 561-440-3830. Again, 561-440-3830. Just text green book, and I will be happy to mail it out to you at, Time to Shine Today’s Dollar.

And Fred, you know I’m gonna ask you this, and it’s my canned question. How do you want your dash remembered? That little line in between your incarnation date and your expiration date, your life date and death date. How does Fred want his dash remembered? 

Fred Moskowitz: My objective and one of my main goals is to make a positive impact.

I strive that every person that I come in contact with throughout my day- 

Coach Fergie: Sure … 

Fred Moskowitz: they walk away just a little bit better- Better. Love it, man … than they were before we crossed paths. I love it. That’s always my- That’s amazing … my goal- Yes … and my desire. 

Coach Fergie: That, and you do, 100%. I’ve met you through Nicole Carnahan, we’ll shout out to the little spitfire, and I’m just blessed to know you, and your guidance you’ve gave me.

And squad, buy the book. Get out there and buy the book. I’ll have it in the show notes. Thank you to Brian [00:26:00] Mudd, my awesome producer. WJNO. You guys go out and have a great weekend. Absolutely love your guts.