American Note Exchange

Until recently this program was a private lending group available to sophisticated investors only. New tools related to banking, finance and the internet available today now allow this program to be offered to the general public who for the first time can participate in the benefits previously enjoyed by a select few. Our program is built to maximize your income not that of a salesperson therefore you may not be exposed to American Note Exchange in a traditional manner.

Q. How does The American Note Exchange make its money?

ANX does not earn money from fees charged to you the homeowner. ANX profits from interest earned on idle funds generated within the program.

Q. How can I earn such a high return of 18%?

The interest income from your investment generates 9% of your return and our participation as your partner in the ownership of your investment generates the rest.

Q. How secure are my funds?

You are protected by contract to receive the payment stream and/or lump sum produced by your investment. YYour funds are secured by the fact that you will be the named beneficiary listed on a specific note and deed of trust on real estate.

Q. How long are my funds invested?

The key to the Cash Flow Program is that our combined funds will yield the highest returns if left untouched for a seven year period./span> During that period you will receive a high monthly cash flow, increased tax deductions and full return of principle at the end of the term. All these benefits are provided with no fees while your funds are secured by real estate. HHowever, early withdraw options may be possible with certain restrictions.

Q. Do I have direct control over my funds?

Yes. The primary objective of ANX is for you to always maximize your return and for you to always be in complete control over the direction and use of your funds. OOne of our obligations as your partner is to provide guidance and suggestions but not authority over final decisions so that you can make those decisions that work best for you.

Q. Is there any event that can cause the interruption of my monthly cash flow?

Provided that ANX has approved of the direction of your funds, we as your partner agree to mitigate and buffer potential interruptions by ensuring you receive your monthly cash flow throughout the seven year term of the program.

Q. Who is the typical member of the program?

The program has been in existence for several years and has many participants throughout the United States. The profile of our typical member is someone who is a homeowner with idle equity or a private investor with cash funds seeking a more secure investment, higher overall return and increased monthly cash flow.

Q. How much can I invest in the Note Exchange?

ANX is comprised of only private investor members. The minimum participation amount is $10,000. There are no restrictions beyond that.

Q. How long has ANX been in business and who are the principals?

ANX was incorporated in Texas in 2005 and our Management Team is comprised of former bankers, financial advisors, Realtors and marketing professionals with over 100 years of industry experience.

Q. What happens if ANX goes out of business or can not pay me back?

The money you receive through the program that arrives on the 15th of the month is the interest income generated by the note and deed of trust on specific property and is paid by the borrower on that note. This income stream is protected in the following manner: You are protected by contract to receive the payment stream and/or lump sum produced by your investment. Your funds are secured by the fact that you will be the named beneficiary listed on a specific note and deed of trust on real estate. It is this 'one on one' relationship that exists between your funds and specific real estate property that provides the security you seek. The note on that property has a 'balloon repayment' clause requiring the note balance remaining be repaid at seven years. How this repayment occurs is the borrowers� choice. The home can be sold, refinanced through ANX, a bank, another mortgage provider or simply paid by the borrower. The money you receive through the program that arrives on the 1st of the month is ANX 'buying' in to your Lending Group and 'buying' you out of the specific notes created. If ANX ceased to exist you would reap the benefit of any funds collected from the program up to the point at which ANX 'went away' and would continue to receive the interest income on the 15th of the month and the payoff required by the note. You would lose any further 1st of the month cash flow.

Q. How do I know that I will get my funds back in seven years?

See the answer to the previous question

Q. What happens if interest rates go up. On me or on the borrower?

We can not control the rate of interest on your personal home equity loan. We believe that the cash flow derived from the program will offset any fluctuations you might experience especially if you have a 'fixed' interest rate. If you have an adjustable interest rate ANX could modify the 1st of the month cash flow and merely 'purchase' the investment 'quicker'. For example the program would only run 74 months rather than 84 months. The interest rates charged to the borrower are 'fixed' by ANX and will therefore not fluctuate during your seven year term as 'lender'.

Q. What happens if the borrower defaults?

One of the main benefits of participation in the ANX program is that as your partner ANX will ensure your monthly cash flow is uninterrupted regardless of any default on the part of an ANX approved borrower. As a 'private' lender your Lending Group does not have to 'fire sale' the property. ANX as your partner will manage the foreclosure process and replace the existing borrower with another who can simply 'take over' the payments.

Q. When will I receive my monthly money?

You receive two monthly cash flow streams on the 1st and 15th of each month.

Q. What about taxes?

A major attraction of the ANX program are the tax advantages. The cash flow received on the 1st of the month is your partner (ANX) 'buying in' to the Lending Group and as such is not taxable income to you. The interest income received on the 15th of the month is 'taxable income' and may have some income tax liability. ANX will 'hold back' 30% of this interest income each month. The sum 'held back' will be sent to you in one lump sum at the same time your annual 1099 Interest income statement is sent to you.

Q. Can I increase my tax deductions?

We encourage our Members to use funds acquired through a home equity product because interest paid on one of these products provides great tax deductions on your annual income. Please consult your CPA or Financial Planner for detailed advice regarding your own tax issues and benefits.

Q. Why is the program for seven years?

The American Note Exchange is a complex combination of financial products, methods and companies traditionally used by professional sophisticated investors. ANX has designed the program to provide these same benefits and maximize cash flow to the Members and ANX while reducing risk and financial exposure to either. To accomplish this requires time and use of working and idle funds. The seven year period is required to allow the process to accomplish these goals.

Q. What happens after the seven years?

The 'balloon' clause in the note is executed. ANX will at this time have 'bought' the investment from you the Lender Member. ANX will return your principal in one lump sum and 'close' your membership. At that time you may choose to pay back your home equity loan if one was used or you may simply reinvest the funds back into the ANX program and begin again. The funds are yours to spend how you choose. We would hope that if you had enjoyed our relationship and the increase cash flow, that you would begin a new membership and repeat the process again and again.

Q. What if I need my money back before the end of the program?

You must remember that to take full advantage of all the potential cash flow the program offers your initial funds have been used to acquire a note and deed of trust on property. This note (contract) has a beginning and an end. The terms of the notes are specific and require seven years to be completed. If you need your funds back before the seven year period ANX will have to find another Lender Member to replace you and 'buy you out' of your note. This is possible but ANX will not guarantee the possibility or the time required to carry it out.

Q. What is the amount of the funds handled by ANX?

ANX is a partner in many Lender Member groups however each group stands alone and does not impact any other group. The ANX program is also a private membership program and ANX protects the identity and value of the Members. Our average Lending group is $200,000 but we groups that range in value from as little as $10,000 to multi-million dollar groups. These numbers are expected to grow as ANX becomes an ever increasing force in the 11 trillion dollar idle equity market. Although not entirely comparable, reverse mortgages as a product have increased 65% over the last several years and ANX grow should be similar.

Q. How can I help my friends or family with their home purchase?

As the Lender you have the opportunity to help choose who the borrower will be and therefore you will be in the position to help either your parents, children, grandchildren or friends purchase or refinance their home while you reap the benefits instead of the bank.

Q. How can I pay for my kids college?

As a Lender Member in the program you receive a considerable increase in your monthly cash flow with all of your principle returned at the end of the program. This extra income can be used in many ways, one of which could be to supplement your child�s education without creating the typical debt associated with college loans.

Q. How do the current sub-prime issues affect this program?

The American Note Exchange is a closed private lending network, therefore it is not subject to the fluctuations of the traditional mortgage industry. All our rates and returns are fixed on both sides of each transaction for the lender and the borrower.

Q. What happens if home values continue to drop?

The answer as it relates to our Lender Members is you have separated the value of your homes equity from your home. If the value of your home declines you have maximized any potential current value. From the borrower's standpoint our Members have loan to value positions of 80% or less in any one note or property allowing for value fluctuations to be mitigated. Our program is focused on cash flow rather than home value. Over the seven year term home values tend to balance out while providing the Member steady, consistent cash flow they would not received otherwise.

Q. What happens if home values increase?

The answer as it relates to our Lender Members is you have separated the value of your homes equity from your home. If the value of your home increases you have maximized any potential current value and may access additional equity as the home value continues to rise. The Members lending group would only benefit from an increased value of the home used as collateral to the note. From the borrower�s standpoint our Members have loan to value positions of 80% or less in any one note or property allowing for value fluctuations to be mitigated.

Q. What happens if I need to sell my home before the end of the 7 years?

There are no restrictions on the sale of your home and the process would be the same as normally handled. Any outstanding equity loan would be repaid from the sales proceeds.

Q. What happens if I die before the 7 years?

We will miss you and keep all your money. Just kidding. Your heirs will by law inherit your assets, including your Lending Group. Your monthly benefits and returned principal will pass to them as well.

Q. What happens if the collateral is destroyed?

Just like your home, a bank would not lend money if the property was not insured nor will ANX.

Q. What happens if the borrower dies?

Again they will be missed! But the note is not in jeopardy unless payments begin to be missed at which time standard foreclosure proceedings will be initiated. The Lender Member will continue to receive monthly cash flow benefits with no interruptions.

Q. Can I increase my investment if yes how so and how often?

Yes, in minimum increments of $10,000. Participation in the Maximizer program allows for quarterly increases on an annual basis. New groups can be created at any time.

Q. If I join the program how soon will I start receiving monthly cash flow?

Monthly deposits begin on the 1st of the month following enrollment.

Q. If I want to refer this program to friends or family will I be compensated?

Yes. One of the Member benefits is the ability to refer other potential members and receive compensation. Once you become a Member you will have access to the full compensation chart. You can enroll right now on our web site.

Q. Are there any other sources (seminars, websites, customer service, media, etc) to find out additional information about ANX?

Yes. ANX will conduct seminars, update its web site, answer customer service queries by phone and email and launch regular media advertising to support our growth and our members. You can find out about all these events at www.anxonline.com

Q. Can I enroll by myself or do I need to contact an agent or some other representative of the company?

Our program has been designed and built to allow the complete enrollment process to be fulfilled online or in person with one of our representatives. Web and telephone assistance will be provided. Contact us at 1-866-658-8705 or on the web at w.anxonline.com

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