Owner financing (also called seller financing) is when the seller acts as the lender, providing financing directly to the buyer. 1st Option Title handles the title search, escrow, and closing for owner-financed transactions, including proper documentation of the note and deed of trust.
In an owner-financed deal, the seller agrees to accept payments over time instead of receiving the full purchase price at closing. The buyer signs a promissory note and gives the seller a deed of trust or mortgage as security. The seller holds a lien on the property until the note is paid off.
The title company prepares the deed of trust, coordinates the note execution, handles escrow for the down payment and closing costs, issues title insurance to both parties, and may service the note. Getting the documentation right is critical for enforceability.
Improperly documented owner-financed transactions can lead to legal problems for both buyer and seller. At 1st Option Title, we ensure the note, deed of trust, and all supporting documents are properly drafted, executed, and recorded.
Contact 1st Option Title to discuss your transaction.