Another strategy used by corporations issuing clap notes to exclude small-time speculators is a waiting period before the first payment is made. Strictly speaking, clap notes are private mortgages on real estate. As such, the payments made to the investors from the “first hand” are remitted monthly. However, since the interest rates on clap notes are so attractive, individuals might be tempted to get low-interest loans from banks and other sources under false pretenses and invest the money in a clap note. A four- to six-month waiting period at the beginning of the note term is intended to discourage such behavior.