A seller-financed sale skips the lender, not the closing. The note, the mortgage, the taxes on both, and the title policy that protects the seller all still have to happen at the table.
- Owner financing is documented with a promissory note and a recorded mortgage, exactly like a bank loan.
- Doc stamps of $0.35 per $100 on the note and intangible tax of $2 per $1,000 on the mortgage are due at recording, on top of the deed stamps.
- The seller should require a lender's title policy in their favor, since they now hold the mortgage.
- Dodd-Frank limits an individual to a small number of seller-financed deals per year without a licensed loan originator.
What owner financing is and why it still needs a closing
In an owner-financed sale the seller conveys the property today and accepts payments over time instead of cash at closing. The buyer signs a promissory note promising to pay, and a mortgage pledging the property as security. The seller records the mortgage in the county's official records, and if the buyer stops paying, the seller forecloses like any other lender. Land contracts and agreements for deed exist in Florida too, but they are treated as mortgages by statute and carry more risk for both sides, so most transactions use the note-and-mortgage structure.
Because a deed is being recorded and a lien is being created, the closing looks like any other: a title search, a title commitment, a settlement statement, a deed, and the note and mortgage. The difference is that the seller occupies the lender's chair, and the protections a bank would insist on are the ones the seller has to remember to ask for.
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Taxes due at recording
Florida taxes both documents. The deed carries documentary stamp tax of $0.70 per $100 of consideration, $0.60 in Miami-Dade for single-family, customarily paid by the seller. The note carries doc stamps of $0.35 per $100 of the amount financed, and the mortgage carries the nonrecurring intangible tax of $2 per $1,000. Those two are customarily paid by the buyer, exactly as they would be on a bank loan, and the clerk will not record the mortgage without proof the stamps were paid. On a $400,000 sale with $320,000 financed, the note stamps are $1,120 and the intangible tax is $640. Run any structure through our doc stamp calculator and intangible tax calculator before you price the deal.
Sellers sometimes try to avoid the note stamps by not recording the mortgage. That leaves the seller with an unrecorded lien that loses to any later recorded interest, and it does not eliminate the tax, which is due on the note itself. Record everything.
The title policy the seller should demand
The buyer receives an owner's policy in the usual way. The seller, now a mortgage holder, should require a lender's policy issued in the seller's name, insuring that the mortgage is a valid first lien on a title with no undisclosed defects. It is issued simultaneously with the owner's policy at the simultaneous-issue rate, which in Florida is a small fraction of the owner's premium, and it protects the seller's collateral for the life of the loan. Our title insurance calculator shows both premiums. The difference between the two policies is explained in owner's versus lender's title insurance.
The seller should also require hazard insurance naming the seller as mortgagee, and if the property is in a flood zone, flood insurance. A bank would. The seller is the bank.
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If the seller still has a mortgage
Owner financing a property that carries an existing mortgage creates a wraparound, and almost every institutional mortgage contains a due-on-sale clause that lets the existing lender call the loan when the deed transfers. Some sellers do it anyway and hope. The buyer in that structure is paying the seller and trusting the seller to pay the bank, with the buyer's home as the thing that gets foreclosed if the seller does not. If the deal must be done this way, the closing agent should collect the underlying payment through a servicing arrangement, and both parties need their own counsel. Assumptions, where the lender consents, are a cleaner alternative and are covered in can you assume a mortgage in Florida.
Federal limits on seller financing
The Dodd-Frank Act and the SAFE Act regulate who may originate residential mortgage loans, and seller financing is not fully exempt. An individual or trust that finances the sale of property it owns may do so without a loan originator license on one property in any twelve-month period if the loan has no balloon and the seller did not build the home, or on up to three properties in twelve months if the loan is fully amortizing or has a balloon no earlier than five years, carries a fixed rate for at least five years, and the seller made a good-faith determination of the buyer's ability to repay. Beyond those thresholds the seller needs a licensed mortgage loan originator to originate the loan. Investors who carry paper on several flips a year routinely violate this without knowing it.
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Submit a Contract →Servicing, payoff and the end of the loan
Someone has to collect the payments, track the balance, issue year-end interest statements and, at payoff, sign a satisfaction of mortgage for recording. Sellers who do this on a spreadsheet create problems at the buyer's future sale, when the title company cannot get a payoff letter or the seller has died and no one can sign the satisfaction. A third-party note servicer costs a few dollars a month and solves all of it. When the buyer eventually sells or refinances, the closing agent will need a written payoff and a recorded satisfaction, the same way it handles a bank loan. Our Florida closing process guide covers that payoff step.
Related Reading
Florida Doc Stamp Calculator 2026: Deed & Mortgage Stamps
Free doc stamp calculator: $0.70 per $100 on the deed ($0.60 in Miami-Dade), $0.35 per $100 on the note, plus intangible tax.
Owner's vs Lender's Title Insurance (2026)
Owner's vs lender's title insurance in Florida — what each covers, who's protected, who pays, costs, duration, and the simultaneous-issue discount..
Can You Assume a Mortgage in Florida? VA, FHA & USDA
FHA, VA and USDA loans are often assumable in Florida, letting a buyer take over a low rate.
Frequently Asked Questions
Is owner financing legal in Florida?
Yes. Seller financing is documented with a promissory note and a recorded mortgage. Federal Dodd-Frank rules limit how many properties an individual may finance per year without a licensed loan originator.
Who pays doc stamps on a seller-financed sale in Florida?
Customarily the seller pays the deed stamps of $0.70 per $100, and the buyer pays the note stamps of $0.35 per $100 and the intangible tax of $2 per $1,000 on the mortgage. All are negotiable in the contract.
Does a seller need title insurance when owner financing?
The seller should require a lender's policy issued in their favor, insuring the mortgage as a valid lien. It is issued at the simultaneous-issue rate alongside the buyer's owner's policy.
Can you owner finance a house that still has a mortgage in Florida?
It creates a wraparound, and most existing mortgages contain a due-on-sale clause allowing the lender to call the loan when the deed transfers. It is risky for both sides and should not be done without counsel.
How many properties can a seller finance in Florida without a license?
Under Dodd-Frank, one property in any twelve-month period with no balloon, or up to three properties in twelve months if the loan meets fixed-rate, balloon and ability-to-repay conditions.
What happens when a seller-financed loan is paid off?
The seller signs a satisfaction of mortgage that is recorded in the county records, releasing the lien. A third-party servicer makes the payoff and satisfaction straightforward years later.