Practice Area
Owner Financing Attorney in Tennessee
When a seller carries the financing instead of sending the buyer to a bank, the paperwork is the deal. I draft and review the note, the deed of trust, and the supporting documents for seller-financed sales — and I flag the federal and Tennessee lending rules that apply to some of these transactions before they turn into a problem.
This page covers a focused service. For the broader editorial practice area, see Business Contracts in Tennessee.
The documents carry the credit risk forward
In a seller-financed sale, the seller is the bank, and the documents are what protect that position after closing. The package is usually a promissory note, a deed of trust securing the note, and supporting paperwork, with real attention to default and remedy provisions, prepayment terms, due-on-sale clauses, and late-fee and acceleration mechanics. If the buyer defaults, a Tennessee deed of trust runs through the standard nonjudicial-foreclosure process, so the note, the deed of trust, and the trustee's role at default all have to line up and be recorded correctly. Loose documents are where a seller's security comes apart.
The lending rules most seller-financed deals never check
Seller financing on a home is not a paperwork-free zone. Depending on the seller's status, the loan purpose, and the property type, a residential seller-financed sale can trip Tennessee's mortgage-licensing rules (Tenn. Code Ann. § 45-13-201), the high-cost home-loan rules (Tenn. Code Ann. § 45-20-101 et seq.), and the usury and home-loan interest-rate limits (Tenn. Code Ann. §§ 47-14-103, 47-14-117, and 47-15-102). I check which of those actually apply rather than assume none do.
And the federal layer: Dodd-Frank and Reg Z
On top of the state rules, federal Dodd-Frank and Reg Z seller-financing requirements apply to consumer-purpose credit secured by a dwelling — with narrow exclusions for one property sold by a natural person, estate, or trust, and for three or fewer properties in a 12-month period (12 C.F.R. § 1026.36). Whether a seller's exemption holds turns on ownership, builder status, amortization, ability-to-repay, and rate-limit conditions specific to the deal. The SAFE Act licensing question can come in too. I work out which exemption (if any) fits and structure the documents to match, because guessing wrong here is expensive.
Seller carrying paper, buyer using seller financing, or investor running these on repeat — the right structure depends on your facts and the rules they trigger, which is exactly what I check before drafting a line.
How to start
Send a short summary of the deal — property, parties, sale price, down payment, and proposed terms. Pricing and turnaround generally returned within one business day.
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