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## Selling my note early to increase my return

**THE SCENARIO**
Let's say I bought half of a note on terms, but after I got it, I wanted to sell it in such a way that my returns would increase.
Here's how I bought the note: 60 payments of $377.70
Here's what I got for that money: 94 payments of $450
My return on this investment will be 10%.
So let's say that after 34 months of receiving payments, I want to sell the note, and I want my overall return on my money to be 11.5%.
The question is: How much would I have to sell my half of the note for, in order to make my *total* return 11.5%?

**THE SOLUTION**
This problem breaks down in two steps.
First, I need to find out what the value of my investment will be after I'm done making my payments, assuming I'm getting my desired 11.5% yield.
Second, I need to figure out what I'll sell the payment stream for once I've received 34 payments, at that same yield.
**Step 1**
First things first, make sure the calculator is using 12 Payments per Year.
N: 60 (I'm paying in for 5 years)
I/YR: 11.5 (My desired yield is 11.5%)
PV: 0
PMT: -377.70 (I pay $377.70 per month for half of the income stream)
FV: (this is what I'm trying to find)
In order to get 11.5% on my money, my investment has to be worth **$30,436.91** after the 5 years.
**Step 2**
N: 34 (I collect payments for 34 months, then sell the remaining payments)
I/YR: 11.5 (My desired yield is 11.5%)
PV: -30,436.91 (Calculated in Step 1, this is what my investment is worth when I start receiving payments)
PMT: 450 (I've bought a payment stream of $450 per month)
FV: (this is what I'm trying to find)

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In order to get 11.5% on my investment, I need to sell the remaining $450 payments for **$24,109.29**.

Sometimes, when we buy an investment, we can increase our returns by selling it to (or sharing it with) someone else, either immediately or after a period of time. In this case, I was able to take a 10% investment and increase my yield to 11.5% by selling part of what I'd bought.

What do you think? Is this something you could see yourself doing in order to increase the yield of your own investments? Do you see any downsides to making this sort of sale? Let us know in the comments!