Anyone with experience doing owner financing in Massachusetts?

[Colleen F.]

I have a condo we bought cash a year ago in Massachusetts and we want to sell. I would meet the dodd frank exceptions if we owner finance the condo.  We are considering this because even though it is in a nice area, excellent school district, this complex has a large percentage of investors so financing may be an issue for a buyer.  We don't need the money right away so our best option may be to owner finance with a  5 year balloon.  Does anyone have experience with this? Just have a lawyer draw contract and record the loan?  I want to know how complex it is before we offer it this way.   Other advice from those in the know? 

[Lien Vuong]

Hello Colleen, 

This could be a great strategy for deferral of tax gains and a method for you to maintain some cash flow without bearing the responsibility of the unit and its tenants. I was luckily involved in a seller financing deal about 3 years ago and simply put, you just facilitate everything as normal (negotiate price and terms of the purchase and then negotiate rates and terms of the loan) but instead of having ABC Bank fund at the closing, you are holding the note. For me, the transaction was performed in MA, and the closing was a transfer for deed and recording of a Promissory Note with the terms as outlined. What you have to do in this situation is to vet the buyers just as you would as a bank, reviewing their financial history, credit worthiness, as well as liquid assets that you would want down at the closing table. 

Best of luck! Lmk if you'd like further input.