Seller Financing in Pennsylvania

3 Replies

Could someone tell me what form needs to be used to sell with owner financing in Pennsylvania?  Land Contract, Contract for Deed, Agreement for Deed, etc.


Welcome to BP, Joe!

Those are all different names for the same animal, and that animal has died a natural death.

The agreement is a sale contract that includes or has attached a note and two deeds are executed and held in escrow until the contract terms have been completed at which time a warranty deed from the seller is filed. The other deed held is a quit claim deed to be filed in the event of default of the contract such filed for the benefit of the seller.

CFDs were very popular especially in the 80s during high interest rates. Got my first home on a CFD! I've cleaned up hundreds of these and did them myself, but times have changed!

This has several issues today, deeds being executed simultaneously, circumventing foreclosure laws, pre-arranged deeds not being accepted for conveyances, besides all the abuses that were involved with these deals.

It's just better to use a note and deed of trust for seller financing. If the is an existing mortgage, then do a "Subject-To" transaction.

You can search the forums for all of these agreements, much has already been written. Good luck :)  

@Joe Ligenza  

Was just in Macungie, last week.

There are at least a couple ways to seller finance:

1.  Deed and mortgage.  You as the seller deed the property to the buyer and the buyer signs and notarizes a mortgage to you.  Both documents get recorded at the County Courthouse in the Recorder of Deeds office.

2.  You keep the deed in your name and you should have an attorney draw up a contract between you the seller and the buyer to protect your interest and detail who pays the taxes, who pays the insurance, who pays the mortgage if any, who pays the utilities, etc.  In some PA municipalities, the water sewer and trash are billed by the government and they will only bill the deeded owner.  In some municipalities even the gas and electric are owned by the government.

In any event consult with a local real estate attorney.

Welcome to bigger pockets.

Thanks guys that is very helpful!

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