Why are mortgage note rates higher than regular mortgage rates?

[Peter Wachira]

Can someone explain to me how mortgage notes end up with interest rates of over 10%.

Is this simply the interest that the home occupier is paying? Or some fraction of it? Either way it seems a bit higher than I would expect. And whats in it for the note seller at these interest rates? Are they just wholesaling and pocketing the difference, or can they not find cheaper financing for other projects they have? I dont get the math around notes - can someone offer some basics?