Action Academy Podcast: From W-2 to $8K/Month Passive — The Note Investing Strategy That Let Sierra Davis Quit Her Job and Pay Off Her Student Debt

Host: Brian Luebben
Guest: Sierra Davis
Release Date: October 9, 2025

Episode Overview

In this Action Academy member spotlight, host Brian Luebben interviews Sierra Davis, a Kansas City-based former data professional who successfully transitioned out of her W-2 career by building a passive income stream of $6K–$8K/month through real estate note investing. Sierra details how note investing not only freed her from her job but enabled her to pay off $60,000 in student loans in under two years. The episode dives deep into the mechanics, economics, and practical strategies behind note investing, making it accessible for high performers looking to exit their corporate roles and gain financial freedom through alternative real estate investments.

Key Discussion Points & Insights

1. Sierra’s Background & Entry Into Note Investing

Transition from Data & Analytics to Note Investing:
- Sierra previously worked in data, analytics, AI, and machine learning, holding an MBA and a six-figure job ([02:04]).
- Realization: Despite a "good" job, student loans burdened her financially ($400/month forever), prompting the search for passive income solutions.
Discovery of Note Investing:
- After researching various real estate strategies, a small book on note investing (by Dave Van Horn) piqued her interest.
- A mentor (her cousin) introduced her to seller financing and creative finance strategies.
- Sierra credits taking action—despite her tendency to overanalyze—as the pivotal moment ([05:13]).
  
  “I took seven months to learn as much as I could before jumping in. And then I just pulled the trigger and went right into that, create a finance side of it first.”
  — Sierra Davis ([02:54])

2. Mindset: Moving from Analysis to Action

Advice for Analytical Thinkers:
Sierra cautions against over-preparing:

“Don’t take seven months like me. Just don’t do it... Read the books, yes. Look at all the data that you do need, and then take action.”
— Sierra Davis ([05:13])
Brian echoes:

“You wait for the confidence to take action, but it's the taking of the action that builds the confidence... What you will learn doing the thing in a month will replace the same time of you learning about the thing in a year.”
— Brian Luebben ([06:16])

3. The Mechanics of Note Investing

What is a Note?
- Most people have existing experience as borrowers, not as note holders ([01:10]).
- Banks (or seller-financers) create promissory notes (the "promise to pay") when lending for property; these are the assets being bought and sold.
  
  “What's interesting... is that the bank can sell that promise to pay to investors like myself, usually at a little slight of a discount... Those monthly payments just go to another bank or investor... that's kind of how you become essentially the bank.”
  — Sierra Davis ([07:19])
Why Sell Notes?
- Banks or private sellers (often investors using seller finance) sell notes to free up capital or offload risk, especially if notes are distressed ([08:43], [09:48]).
How Investors Make Money:
- Investors buy the right to receive monthly mortgage payments at a discount, resulting in a yield higher than traditional savings or rental investments ([13:57]).
- Example: Purchasing a $25,000 unpaid balance note for $22,000 at a 12% yield. Expenses are minimal (e.g., $25/month for a loan servicer).
“Let's say I bought this note for 22,500. I'm getting 12% return every year, and my monthly payment for the borrower is $500. My only expense is $25.”
— Sierra Davis ([13:57])
Position and Risk:
- Investors often have a first position lien—if the borrower defaults, the property can go to foreclosure and the investor can recoup by selling the asset ([14:00]).
- Three Ps: People (borrowers), Property (collateral), Paperwork (enforceability of the note) ([11:56]–[15:43]).
“If those things are in place and I have to go through a foreclosure, it needs to be enforceable.”
— Sierra Davis ([15:08])

4. Practical Aspects: Deal Sourcing, Underwriting, Returns

Finding Deals:
- Sourcing via county records, direct-to-seller outreach, notes marketplaces (including various asset types: single family, land, mobile homes, etc.) ([17:55]).
- Note: "Everything has some type of note... Car notes—don’t buy car notes!” ([17:55])
Buy Box & Criteria:
- Focused on states with non-judicial, faster foreclosure; unpaid balances between $25K and $75K; 5–10 years remaining; looking for 12-15% yield; prefer ‘seasoned’ notes (where borrowers have a track record of consistent payments) ([19:38]).
- Risk mitigation through due diligence.
Funding & Scaling:
- Uses capital partners—private investors (often using self-directed IRAs) share in returns.
- Strategies include selling partial notes (for shorter-term cash), hypothecation (borrowing against notes), and building a team for due diligence and deal flow ([21:58], [24:28]).

5. Portfolio, Team Building, and Scaling

Current Portfolio:
- Approximately $250,000 under management across 26+ transactions in 7 years.
- Building a team for due diligence, legal, and operations as business scales ([24:28]).
Vision for the Future:
- Goal is to 10x the business in three years, increase monthly income, and help others gain homeownership through alternative means ([26:02]).
Handling Challenges:
- Not all deals are perfect—discusses current foreclosure with no payments for a year, but notes recovery by repossessing and selling property ([24:28]).

6. How to Get Started

Advice for Beginners:
- Find educational resources (Sierra mentions her own book/education series).
- Take action quickly (don’t overlearn).
- Understand your investment goals; notes are powerful for cashflow but less so for those chasing appreciation ([26:50]).
“Once you find out what you're optimizing for... If you're optimizing for monthly cash flow, this is a strategy that you can't deny.”
— Sierra Davis ([26:50])
Minimum Recommended Capital:
- $20,000–$25,000 for a quality note with 12%+ annualized return ([28:36]).
  
  “With 20,000, you could get a really strong note that pays about 12% on your money.”
  — Sierra Davis ([28:36])
Where to Learn More:
- Instagram: @sierradavisofficial
- Website: wealthwithnotes.com (includes free educational email course) ([27:58])

Notable Quotes & Memorable Moments

On Action over Analysis:

“Read the books, yes. Look at all the data that you do need, and then take action. Take action on just that thing.”
— Sierra Davis ([05:13])
On Returns Compared to Other Investments:

“If you put that same 22,500 in a high yield savings account... maybe 4.5%, where I can go buy a note that's secured by real estate, maybe 12 to 15%.”
— Sierra Davis ([16:12])
On Downsides ("No tenants, toilets, or termites"):

“All of the rental income and all the upside with the downside is the borrower defaults on the loan, in which case you take ownership of the asset.”
— Brian Luebben ([19:15])
On the Sturdiness of Notes:

“Whatever's in that contract remains the same.”
— Sierra Davis ([29:23])

Timestamps for Key Segments

00:00 — Sierra quits W-2, earns $6–8K/month, pays off $60K student debt
02:04 — Sierra’s data background, MBA, and discovery process
05:13 — Advice on moving past 'analysis paralysis'
07:19 — Explaining what a ‘note’ is and how banks sell notes
09:48 — Why banks and sellers sell notes
11:56 — Anatomy of a note deal: people, property, paperwork
13:57 — Example yields, expenses, foreclosure scenarios
16:12 — How profit is generated (spread, yields)
17:55 — Ways to find deals and types of notes
19:38 — Sierra's buy box, criteria, and funding methods
21:58 — Funding via capital partners, scaling strategies
24:28 — Business today, portfolio size, team building
26:02 — 3-year vision, helping underserved buyers
26:50 — Practical steps and advice for beginners
27:58 — Where to find Sierra and free resources
28:36 — Minimum capital needed, comparison to stock market
29:23 — Stability of notes vs. market volatility

Resources & Where to Find Sierra

Instagram: @sierradavisofficial
Website: wealthwithnotes.com — Free educational email course on note investing

Summary Takeaways

Sierra Davis offers a clear, actionable look at how note investing can generate robust, mostly passive income, rivaling and outpacing traditional rental real estate without the operational headaches. Her journey is an inspirational and practical roadmap for high-income professionals with cash to invest and a hunger for financial freedom. The episode is packed with both mindset and tactical advice, honest discussion of risks, and play-by-play instructions for getting started.

Perfect For:
Listeners wanting to replace their jobs with passive income, analytically-minded professionals stuck in 'paralysis by analysis,' or anyone interested in creative, lower-hassle real estate investing.

For links, resources, and Sierra’s offer, visit wealthwithnotes.com and follow her on Instagram at @sierradavisofficial.

Action Academy Podcast: From W-2 to $8K/Month Passive — The Note Investing Strategy That Let Sierra Davis Quit Her Job and Pay Off Her Student Debt

Host: Brian Luebben
Guest: Sierra Davis
Release Date: October 9, 2025

Episode Overview

Key Discussion Points & Insights

1. Sierra’s Background & Entry Into Note Investing

Transition from Data & Analytics to Note Investing:
- Sierra previously worked in data, analytics, AI, and machine learning, holding an MBA and a six-figure job ([02:04]).
- Realization: Despite a "good" job, student loans burdened her financially ($400/month forever), prompting the search for passive income solutions.
Discovery of Note Investing:
- After researching various real estate strategies, a small book on note investing (by Dave Van Horn) piqued her interest.
- A mentor (her cousin) introduced her to seller financing and creative finance strategies.
- Sierra credits taking action—despite her tendency to overanalyze—as the pivotal moment ([05:13]).
  
  “I took seven months to learn as much as I could before jumping in. And then I just pulled the trigger and went right into that, create a finance side of it first.”
  — Sierra Davis ([02:54])

2. Mindset: Moving from Analysis to Action

Advice for Analytical Thinkers:
Sierra cautions against over-preparing:

“Don’t take seven months like me. Just don’t do it... Read the books, yes. Look at all the data that you do need, and then take action.”
— Sierra Davis ([05:13])
Brian echoes:

“You wait for the confidence to take action, but it's the taking of the action that builds the confidence... What you will learn doing the thing in a month will replace the same time of you learning about the thing in a year.”
— Brian Luebben ([06:16])

3. The Mechanics of Note Investing

What is a Note?
- Most people have existing experience as borrowers, not as note holders ([01:10]).
- Banks (or seller-financers) create promissory notes (the "promise to pay") when lending for property; these are the assets being bought and sold.
  
  “What's interesting... is that the bank can sell that promise to pay to investors like myself, usually at a little slight of a discount... Those monthly payments just go to another bank or investor... that's kind of how you become essentially the bank.”
  — Sierra Davis ([07:19])
Why Sell Notes?
- Banks or private sellers (often investors using seller finance) sell notes to free up capital or offload risk, especially if notes are distressed ([08:43], [09:48]).
How Investors Make Money:
- Investors buy the right to receive monthly mortgage payments at a discount, resulting in a yield higher than traditional savings or rental investments ([13:57]).
- Example: Purchasing a $25,000 unpaid balance note for $22,000 at a 12% yield. Expenses are minimal (e.g., $25/month for a loan servicer).
“Let's say I bought this note for 22,500. I'm getting 12% return every year, and my monthly payment for the borrower is $500. My only expense is $25.”
— Sierra Davis ([13:57])
Position and Risk:
- Investors often have a first position lien—if the borrower defaults, the property can go to foreclosure and the investor can recoup by selling the asset ([14:00]).
- Three Ps: People (borrowers), Property (collateral), Paperwork (enforceability of the note) ([11:56]–[15:43]).
“If those things are in place and I have to go through a foreclosure, it needs to be enforceable.”
— Sierra Davis ([15:08])

4. Practical Aspects: Deal Sourcing, Underwriting, Returns

Finding Deals:
- Sourcing via county records, direct-to-seller outreach, notes marketplaces (including various asset types: single family, land, mobile homes, etc.) ([17:55]).
- Note: "Everything has some type of note... Car notes—don’t buy car notes!” ([17:55])
Buy Box & Criteria:
- Focused on states with non-judicial, faster foreclosure; unpaid balances between $25K and $75K; 5–10 years remaining; looking for 12-15% yield; prefer ‘seasoned’ notes (where borrowers have a track record of consistent payments) ([19:38]).
- Risk mitigation through due diligence.
Funding & Scaling:
- Uses capital partners—private investors (often using self-directed IRAs) share in returns.
- Strategies include selling partial notes (for shorter-term cash), hypothecation (borrowing against notes), and building a team for due diligence and deal flow ([21:58], [24:28]).

5. Portfolio, Team Building, and Scaling

Current Portfolio:
- Approximately $250,000 under management across 26+ transactions in 7 years.
- Building a team for due diligence, legal, and operations as business scales ([24:28]).
Vision for the Future:
- Goal is to 10x the business in three years, increase monthly income, and help others gain homeownership through alternative means ([26:02]).
Handling Challenges:
- Not all deals are perfect—discusses current foreclosure with no payments for a year, but notes recovery by repossessing and selling property ([24:28]).

6. How to Get Started

Advice for Beginners:
- Find educational resources (Sierra mentions her own book/education series).
- Take action quickly (don’t overlearn).
- Understand your investment goals; notes are powerful for cashflow but less so for those chasing appreciation ([26:50]).
“Once you find out what you're optimizing for... If you're optimizing for monthly cash flow, this is a strategy that you can't deny.”
— Sierra Davis ([26:50])
Minimum Recommended Capital:
- $20,000–$25,000 for a quality note with 12%+ annualized return ([28:36]).
  
  “With 20,000, you could get a really strong note that pays about 12% on your money.”
  — Sierra Davis ([28:36])
Where to Learn More:
- Instagram: @sierradavisofficial
- Website: wealthwithnotes.com (includes free educational email course) ([27:58])

Notable Quotes & Memorable Moments

On Action over Analysis:

“Read the books, yes. Look at all the data that you do need, and then take action. Take action on just that thing.”
— Sierra Davis ([05:13])
On Returns Compared to Other Investments:

“If you put that same 22,500 in a high yield savings account... maybe 4.5%, where I can go buy a note that's secured by real estate, maybe 12 to 15%.”
— Sierra Davis ([16:12])
On Downsides ("No tenants, toilets, or termites"):

“All of the rental income and all the upside with the downside is the borrower defaults on the loan, in which case you take ownership of the asset.”
— Brian Luebben ([19:15])
On the Sturdiness of Notes:

“Whatever's in that contract remains the same.”
— Sierra Davis ([29:23])

Timestamps for Key Segments

00:00 — Sierra quits W-2, earns $6–8K/month, pays off $60K student debt
02:04 — Sierra’s data background, MBA, and discovery process
05:13 — Advice on moving past 'analysis paralysis'
07:19 — Explaining what a ‘note’ is and how banks sell notes
09:48 — Why banks and sellers sell notes
11:56 — Anatomy of a note deal: people, property, paperwork
13:57 — Example yields, expenses, foreclosure scenarios
16:12 — How profit is generated (spread, yields)
17:55 — Ways to find deals and types of notes
19:38 — Sierra's buy box, criteria, and funding methods
21:58 — Funding via capital partners, scaling strategies
24:28 — Business today, portfolio size, team building
26:02 — 3-year vision, helping underserved buyers
26:50 — Practical steps and advice for beginners
27:58 — Where to find Sierra and free resources
28:36 — Minimum capital needed, comparison to stock market
29:23 — Stability of notes vs. market volatility

Resources & Where to Find Sierra

Instagram: @sierradavisofficial
Website: wealthwithnotes.com — Free educational email course on note investing

Summary Takeaways

For links, resources, and Sierra’s offer, visit wealthwithnotes.com and follow her on Instagram at @sierradavisofficial.

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From W-2 to $8K/Month Passive: The Note Investing Strategy That Let Sierra Davis Quit Her Job and Pay Off Her Student Debt

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Summary

Action Academy Podcast: From W-2 to $8K/Month Passive — The Note Investing Strategy That Let Sierra Davis Quit Her Job and Pay Off Her Student Debt

Episode Overview

Key Discussion Points & Insights

1. Sierra’s Background & Entry Into Note Investing

2. Mindset: Moving from Analysis to Action

3. The Mechanics of Note Investing

4. Practical Aspects: Deal Sourcing, Underwriting, Returns

5. Portfolio, Team Building, and Scaling

6. How to Get Started

Notable Quotes & Memorable Moments

Timestamps for Key Segments

Resources & Where to Find Sierra

Summary Takeaways

Summary

Action Academy Podcast: From W-2 to $8K/Month Passive — The Note Investing Strategy That Let Sierra Davis Quit Her Job and Pay Off Her Student Debt

Episode Overview

Key Discussion Points & Insights

1. Sierra’s Background & Entry Into Note Investing

2. Mindset: Moving from Analysis to Action

3. The Mechanics of Note Investing

4. Practical Aspects: Deal Sourcing, Underwriting, Returns

5. Portfolio, Team Building, and Scaling

6. How to Get Started

Notable Quotes & Memorable Moments

Timestamps for Key Segments

Resources & Where to Find Sierra

Summary Takeaways