A seller carrying a single note opens and operates a compliant trust account in a workflow that takes one afternoon to set up and twenty minutes a month to maintain. The guide below walks the ten steps from account opening through the year-end close, [...]
A single-note seller-carry holder operates the same trust account discipline a hundred-loan servicer operates, on smaller volume. The eight mistakes below recur in single-note files brought to a licensed servicer for cleanup before resale or before a state inquiry.Mistake one — depositing borrower funds [...]
A seller who carried back a note at closing is collecting borrower funds the moment the first monthly payment arrives. A portion of that payment is principal and interest owed to the seller; another portion is escrow for property taxes and insurance owed to [...]
A seller in the trade or business of carrying back notes owes a Form 1098 to every borrower who paid six hundred dollars or more in interest during the year. The form is not complicated when the records are clean. This guide walks the [...]
The ten questions below recur every January in conversations with seller-carry note holders. Each question has a clean technical answer when the records are clean, and a complicated answer when the records are gaps. The questions are framed as a holder's self-check before sitting [...]
Three recurring 1099 filing errors show up in self-served seller-carry files. Each error compounds across years, each triggers IRS penalty exposure, and each is preventable with a clean recordkeeping discipline. The patterns below come from self-served files brought to a licensed servicer for cleanup [...]
Two IRS information returns sit on the seller-carry note holder's desk every January — Form 1098 (Mortgage Interest Statement) and Form 1099-INT (Interest Income). The two forms report similar dollars but serve different rules. The holder picks one based on whether the activity is [...]
Five IRS information returns sit in front of every seller-carry note holder at year-end. The holder owes some subset every January, with the specific subset driven by what happened on each note during the year. This list walks the five forms, the trigger that [...]
A seller who carried back paper at closing — a note in exchange for part of the purchase price — owns a financial asset that pays interest and triggers federal information reporting every January. Year-end is the moment all the spreadsheet records get tested [...]
A seller who has decided to stop self-servicing a note follows a documented hand-off process. The ten-step framework below is what a licensed servicer expects on intake and what a state regulator will look at if the borrower complains about the transfer. Run the [...]
