Mortgage Note Investing: How to Earn Passive Income Backed by Real Estate with Blue Bay Fund I
Earn Predictable Income with Mortgage Note Investing
Tired of market swings and Wall Street volatility? Mortgage note investing offers passive income secured by real estate. With Blue Bay Fund I, accredited investors can earn monthly cash flow by investing in mortgage notes secured by real property. Learn how to buy mortgage notes, where to invest safely, and why Blue Bay Fund I is trusted by conservative investors seeking capital preservation and legacy building.
Introduction: Income You Can Count On — Even in Volatile Markets
As a conservative, accredited investor, you're tired of market swings, Wall Street jargon, and hidden fees. You want clarity. You want control. And above all, you want cash flow backed by real assets. That’s where mortgage note investing comes in.
Through Blue Bay Fund I, you can invest in mortgage loans based on bank statements and other secured structures—offering transparency, risk mitigation, and steady income. This is not speculation. This is investing in notes and mortgages with integrity and vision.
Book a 15-Minute Strategy Call — See the Notes, Understand the Yields, Decide with Confidence.
SCHEDULE CONSULTATION
Get transparent answers, real returns, and a plan you can trust — backed by real estate, not Wall Street.
What Is Mortgage Note Investing?
Understanding Mortgage Note Investing
Make it stand out
A mortgage note is a legal document—often called a promissory note—that outlines the repayment terms of a mortgage loan. When you invest in mortgage notes, you become the note holder, essentially stepping into the shoes of the mortgage lender.
Instead of owning the property itself, you own the debt secured by it. That means you collect mortgage payments—usually monthly interest or principal and interest—from the borrower.
You do not own the property, but you do own the right to the income. It’s one of the few ways to earn consistent cash flow that is secured by real estate, without managing tenants or toilets.
This approach allows you to generate passive income while maintaining legal protections and collateral, making it an attractive alternative for conservative investors.
Legal Structure & Key Terms
Note is a legal agreement representing the debt obligation of the borrower.
Promissory note: The borrower’s promise to repay the loan amount.
Mortgage loan: Backed by real estate, this secures the lender’s (your) position.
Interest rates: Typically fixed or adjustable depending on the borrower agreement.
Loan-to-Value (LTV) and Loan-to-After-Repair-Value (LTARV) help determine the purchase price and risk exposure.
Types of Mortgages and Notes
There are multiple types of mortgages you may come across when evaluating a note for investment, including fixed-rate, adjustable-rate, and balloon mortgages. However, in the mortgage note investing world, we primarily focus on:
Owner-Occupied Mortgage Notes
These are notes tied to a borrower's primary residence. While they may offer a steady lump sum repayment at maturity, they come with strict regulations, ethical concerns, and foreclosure challenges.
Non-Owner Occupied Notes (Preferred by Blue Bay Fund I)
These are notes on investment properties. Lower leverage, better terms, and higher yields make them more desirable for passive note investors.
Why Invest in Mortgage Notes?
Benefits of Real Estate Mortgage Note Investing
Make it stand out
Passive Monthly Income: Predictable distributions—without managing tenants or repairs.
Secured by Real Property: Investing in secured real estate notes is investing like a bank.
Higher Yields Than Bonds or CDs: Historical performance favors this asset class.
Tax-Advantaged Accounts: Use a self-directed IRA or a qualified retirement plan.
Click here to explore how to use your Self-Directed IRA for note investing.
Portfolio Diversification with Mortgage Notes
Mortgage notes are non-correlated assets, helping you avoid stock market volatility. Plus, with Blue Bay Fund I, you gain:
Geographic diversification across the Southeast U.S.
Fractional ownership in multiple notes
Exposure to a variety of markets
Legacy Planning: Generational Wealth from Notes
Mortgage notes can be placed into family trusts, offering passive income for heirs. Blue Bay Fund I helps investors structure their portfolios for long-term legacy building.
Schedule Your Strategy Call to learn how to invest with your trust, IRA, or family office.
SCHEDULE CONSULTATION
Get transparent answers, real returns, and a plan you can trust — backed by real estate, not Wall Street.
Case Study: How One Investor Secured 9.00% Returns with Blue Bay Fund I
Case Study: 9.00% Returns with Blue Bay Fund I
Meet Tom, a retired firefighter. With $150K invested across 10 notes, he earned a 9.00% annualized return—all without lifting a finger.
“The transparency was unmatched. I reviewed every deal before investing.” – Thomas I.
Monthly interest
Compounding returns
No property management headaches
Funded family wedding and missionary giving
Recap: What Tom Experienced with Blue Bay Fund I
Tom was able to choose where his capital was deployed, across 10 performing notes with LTVs under 65%, with an average participation of only $15,000 per note.
Monthly interest income began on day 1, paid out on the 15th of each subsequent month following his investment.
His weighted average annualized return: 9.00%
The borrowers of his loans paid every month, and thus, he received a monthly payment of interest only.
During that year, several of the loans he invested in were paid back, and he was able to reinvest his principal and interest into additional loans, thus achieving compounding interest.
While compounding is difficult for most private lenders, it was easily achieved through Blue Bay Fund I.
Passive income helped fund his daughter's wedding and monthly giving to his church’s missionary work. . With $150K invested across 10 notes, he earned a 9.00% annualized return—all without lifting a finger.
“The transparency was unmatched. I reviewed every deal before investing.” – Thomas I.
Monthly interest
Compounding returns
No property management headaches
Funded family wedding and missionary giving
“What stood out was the transparency. I got access to each note underwriting file, could ask underwriting questions, and I knew exactly where my money was going. I’m now looking to reinvest my distributions and share this strategy with my friends and family! Thank you Edwin.” - Thomas I.
Book a 15-Minute Strategy Call — See the Notes, Understand the Yields, Decide with Confidence. Get transparent answers, real returns, and a plan you can trust — backed by real estate, not Wall Street.
Where to Buy Mortgage Notes Safely Online
Mortgage Notes for Sale: Your Options
Institutional Sellers: Banks, hedge funds
Online Platforms: Like Paperstac
Private Funds: Like Blue Bay Fund I
Wondering how to buy mortgage notes online with confidence? Our fund takes care of due diligence, underwriting, and servicing. No hidden fees.
Click here to explore the full Blue Bay Fund I overview and learn more about our investment strategy.
Buying Mortgage Notes vs Investing Through a Fund
Why Private Mortgage Note Buyers Choose Blue Bay Fund I
Instead of sourcing, underwriting, and managing loans alone, investors trust us to deliver hand-curated, first-lien mortgage note investments backed by real collateral.
We also provide access to real estate mortgage note investing opportunities not available on public platforms.
Risk Management in Mortgage Note Investing
Common Risks
Default Risk: Borrower stops paying
Liquidity Risk: Can't sell the note quickly
Market Risk: Property value declines
Our Mitigation Strategies
Short terms (<18 months)
Conservative LTV underwriting
Property insurance, title insurance, and strong borrower vetting
Real-time reporting and full investor transparency
Selling and Buying Mortgage Notes
While this post focuses on buying, some investors choose to sell a mortgage note after appreciation or if their cash needs change. Platforms like Paperstac or private funds make selling mortgage notes easier and more efficient—especially for those looking to cash out a portion of their portfolio.
Investors can either sell the full note or a lump sum partial interest.
Making an Informed Decision
Before jumping in, it’s critical to make an informed decision. Consider your risk tolerance, liquidity needs, and investment goals. Mortgage note investing offers stability and returns—but like all investments, it requires due diligence.
Book a 15-Minute Strategy Call to discuss how to evaluate a mortgage loan for income and legacy growth.
SCHEDULE CONSULTATION
Get transparent answers, real returns, and a plan you can trust — backed by real estate, not Wall Street
Competitor Comparison: Why Investors Choose Blue Bay Fund I
You’ve worked hard to build your wealth. Now you want peace of mind and passive returns. With Blue Bay Fund I, you get:
Transparent underwriting
Fractional participation
Personalized portfolio selection
Hands-on management from veteran investor Edwin Epperson
Why Tom (And Investors Like Him) Choose Blue Bay Fund
Tom's a retired firefighter. He’s spent a lifetime building wealth by making more aggressive investments, but now wants peace of mind, stable and dependable income, and passive cash flow to bless his family and his church. Blue Bay Fund I gives him just that—with fractional note investing, he can participate in partial notes, confident that the team at Blue Bay Fund, with Edwin Epperson at the helm, is stewarding his retirement savings, honoring his lifetime of sacrifice and hard work.
📞 Book a 15-Minute Strategy Call — See the Notes, Understand the Yields, Decide with Confidence.
Get transparent answers, real returns, and a plan you can trust — backed by real estate, not Wall Street.
Getting Started with Blue Bay Fund I
Ready to Invest in Mortgage Notes? Here’s Your Next Step
Book a Consultation: Speak with directly with our fund manager, Edwin Epperson.
Review Fund Presentation: Watch a no-sales, non-pressure presentation over the fund by our manager.
Onboarding: Create your fund investment account at your own pace and schedule. Typical onboarding can be as little as a few business days.
Verify Accreditation: Receive an accreditation letter from your CPA, or use our free accreditation process that takes only a few minutes.
Invest via IRA, trust, or personal funds: Decide from where your invested capital is coming from and fund your account.
Personalize Your Portfolio: Hand-pick which loans you want to participate in, hand selected and carefully curated.
Earn Passive Income, Secured to Real Estate: Earn monthly income directly to your fund account and choose to reinvest your earnings or withdraw your earnings for living expenses.
Book a 15-Minute Strategy Call — See the Notes, Understand the Yields, Decide with Confidence.
Get transparent answers, real returns, and a plan you can trust — backed by real estate, not Wall Street.
Conclusion: Passive Income with Purpose
If you’re ready to protect your capital while generating income backed by real estate, it’s time to consider mortgage note investing. Blue Bay Fund I exists to help faith-driven, conservative investors like you preserve wealth and build a legacy.
Schedule Your Strategy Call Today
Accredited. Conservative. Real-Asset Backed.
Join Blue Bay Fund I — Earn with Clarity and Confidence.
Edwin D. Epperson III,
Manager & CEO
Soli Deo Gloria
