Balloon on Seller Finance Note

[Randon B.]

I am about to put a house up for sell and I would like to sell finance the note. I was told that if I was selling to an owner occupy then I could not add a balloon as part of the note. Though if I was selling to an investor I could. 

How do you differentiate between an owner occupy and an investor during the procuring process?? Is it as simple as just asking? But who's to say they wont rent it out after closing etc?

[Robin Simon]

You were probably told to stay away from owner-occupant loans because of the licensing and legal regulations around it.  It might not be prohibited but lots of hoops and requirements.

Generally, there are little regulations against investor loans because its assumed the investor is running a business and knows what they are doing, and the downside is just a loss of invested assets

Much more regs on owner-occupied because most owner-occupants aren't in the real estate business, can't be reasonably expected to know all the details of RE transactions (they might make a couple of house purchases in a lifetime) and downside would be loss of home, not just investments