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Randon B.
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Rules/Laws for advertising Owner Financed Homes

Randon B.
  • Appraiser
  • Austin, TX
Posted Jan 10 2023, 10:23

Hello

What are the rules for advertising a home for sale owner finance? 

Are you allowed to state the APR% that you are offering?

Thanks

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Eliott Elias#3 BRRRR - Buy, Rehab, Rent, Refinance, Repeat Contributor
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Eliott Elias#3 BRRRR - Buy, Rehab, Rent, Refinance, Repeat Contributor
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Replied Jan 10 2023, 21:06

I state everything, interest rate, balloon, amortization, price. 

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Andrew Postell
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Andrew Postell
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Replied Jan 10 2023, 22:08

@Randon B. thanks for posting.  Always great to hear from a fellow Texan.

So you are actually asking 2 different questions here:

1. Are there rules to advertising a "for sale by owner" property?

2. Are there rules to advertising a "Owner Finance" loan?

And there are rules to both.  Some rules are strict but most are pretty easy to comply with.  Now, there is a separate issue here - what are the rules to writing an owner financed loan in Texas?  I'm not going to touch on that very much but I'll give a little article you can read on it HERE.

For the For Sale by Owner try this website HERE.  You can also list your property there as well.

And for advertising your rate - just keep in mind that anything you advertise must be true and accurate.

Hope this makes helps in some way.  Thanks!

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Chris Seveney
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Chris Seveney
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Replied Jan 11 2023, 03:59

@Randon B.

Depends. There are triggers. If you note a payment amount then absolutely must give terms of loan. 99% of seller financed people do not though

https://www.consumerfinance.gov/rules-policy/regulations/1026/24/#d

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Randon B.
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Randon B.
  • Appraiser
  • Austin, TX
Replied Jan 16 2023, 13:37
Quote from @Eliott Elias:

I state everything, interest rate, balloon, amortization, price. 


 How do you go about ensuring that all the disclosure requirements are met? Is there a checklist or something?

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Randon B.
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Randon B.
  • Appraiser
  • Austin, TX
Replied Jan 16 2023, 13:38
Quote from @Andrew Postell:

@Randon B. thanks for posting.  Always great to hear from a fellow Texan.

So you are actually asking 2 different questions here:

1. Are there rules to advertising a "for sale by owner" property?

2. Are there rules to advertising a "Owner Finance" loan?

And there are rules to both.  Some rules are strict but most are pretty easy to comply with.  Now, there is a separate issue here - what are the rules to writing an owner financed loan in Texas?  I'm not going to touch on that very much but I'll give a little article you can read on it HERE.

For the For Sale by Owner try this website HERE.  You can also list your property there as well.

And for advertising your rate - just keep in mind that anything you advertise must be true and accurate.

Hope this makes helps in some way.  Thanks!



How do you go about ensuring that all the disclosure requirements are met? Is there a checklist or something?


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Randon B.
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Randon B.
  • Appraiser
  • Austin, TX
Replied Jan 16 2023, 13:38
Quote from @Chris Seveney:

@Randon B.

Depends. There are triggers. If you note a payment amount then absolutely must give terms of loan. 99% of seller financed people do not though



How do you go about ensuring that all the disclosure requirements are met? Is there a checklist or something?

https://www.consumerfinance.gov/rules-policy/regulations/1026/24/#d


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Chris Seveney
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Chris Seveney
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Replied Jan 16 2023, 14:14

@Randon B.

Either provide no info or all info. Saying payments will be $500/mo is not good

Saying $500/Mo for 240 months based on a financed amount of $25,000 at 6% interest says everything

Make sense

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Randon B.
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Randon B.
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Replied Jan 16 2023, 14:22
Quote from @Chris Seveney:

@Randon B.

Either provide no info or all info. Saying payments will be $500/mo is not good

Saying $500/Mo for 240 months based on a financed amount of $25,000 at 6% interest says everything

Make sense


 Im talking about once I have a buyer under contract and we are moving towards closing. I'm just trying to make sure that I'm not breaking any dodd frank laws regarding disclosures during the closing process. 

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Andrew Postell
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Andrew Postell
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Replied Jan 16 2023, 14:22

@Randon B. so just to answer the disclosure piece - you would lean on your title attorney for it.

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