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THE SCENARIO
Last time, we talked about what would happen if I sold a note after owning it for a relatively short period of time. However, nothing's forcing me to sell the note. So what happens if I hold onto it, and the borrower pays it off early (through a refinance or just by coming up with a bunch of cash) rather than paying it off entirely over time?
The question: I bought a fully-amortizing note for $79,000 with an unpaid balance of $100,000, a payment of $898.83, and remaining term of 15 years. I collect payments for 6 years, and the borrower pays it off. What's my return?
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