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5 Common Mistakes to Avoid When Creating Seller-Financed Notes

By Clayton W. Davis
September 26, 2025
9 minutes

Avoid pitfalls when creating seller-financed notes: buyer vetting, adequate down payment, solid legal docs, insurance and tax escrows, and a clear exit strategy.

Creating a seller-financed note can be a smart way to close a deal and earn interest over time, but avoid common mistakes that can hurt your investment.

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About the author

Clayton W. Davis

President, Note Buyers of America

Clayton W. Davis is President of Note Buyers of America. He focuses on seller-financed note valuation, risk analysis, and investor education.