How do I use a note as collateral?!

[Logan Turner]

I've been reading a few note guides, and came across the concept of using your note as collateral for another loan. This way instead of selling, paying taxes, you can borrow against it and invest again. Anyone have any idea how to do this? I have a note with UPB at 91k and 10 percent interest rate and I'd love to get a personal loan for around 25-35k. I can sell the note for 74k but would be hit with a tax cost of around 40 percent. And I don't need all 74k right now. I'm also not too keen on a partial note as I feel my position in the repayment if a default occurred would risk me losing it all, since all lawyer fees etc get paid first! Anyone able to help me get creative and squeeze out some money from this note without selling it all or partial?

[Logan Turner]

In case anyone is interested. Commercial lender got back to me and they will in fact issue me a loan strictly off my note.

How it works. Note receivable will be assigned to bank as collateral should I fail to make payments.
The note receivable must have a promissory note and deed of trust and no other lien on the property.

Commercial lender will lend for a max of 15 years and up to 80 percent of cost, note UPB, and house appraised value. Whichever is the lowest. They will make an exception if for example my all in cost was 60k. Note was 95k and house value was 100k. They would then lend 100 percent of cost. So 60k in this example. Again they won't amortize a loan for 15 years if the note is 10 years. So it has to be equal or less on length. Since it is the collateral.

So here's what it looks like broken down.
Cost 60k, note 92k @10 percent for 10 years house value 95k

Bank will issue me a loan (check in mail) for 60k 5.8 % interest and 10 year am.

I receive 1256 from the note each month
I pay 662 on the loan each month.
Plus I get my 60k back and rinse and repeat.

That my friends is arbitrage at it's best.