The five documents every seller‑finance deal needs

And here's 5 documents you're going to need in every seller financing transaction, and they need to be executed properly. Promissory note is the debt instrument, the formal record of the obligation. It states every term, the amount, rate, amortization, payment schedule, prepayment rights, etc. The buyer signs it. You're going to want to have a real estate attorney draft it. This is not a form you're going to pull off the internet. The deed of trust or mortgage secures the note against the real property. It's recorded with the county. And it creates the public lien record. This is what gives the seller the right to foreclose if payment stops. It must be properly drafted and recorded to be enforceable. The subordination agreement documents all 3 parties' agreement on, on lien property or priority. The bank is in first position, the seller in second. All 3 parties sign. The bank will require this before they will close the loan.