Calculating yield on a note with servicing

[Jimmy G.]

Hi All,

I’m starting to look into mortgage notes as an investment.  When accounting for servicing fees I’m removing the cost from the total monthly payment to calculate the yield.  So if the payment is $400 per/month and the servicing fee is $25 per/month I’m assuming  the the payment is $375 per/month for the yield calculation.  Is this the correct way to do this?