Simplifying Seller Finance

Seller finance compliance feels messy because multiple rule sets overlap and the gray areas are real. In this episode, I break down the essentials—Dodd-Frank Ability-to-Repay (ATR), TRID timelines, and the "Rules of 1, 3, and 5"—and show you how to keep deals simple, compliant, and sellable. Key takeaways Dodd-Frank ATR (the big one): If your borrower is an owner-occupant, you must make a good-faith determination they can repay (credit, income, debts, residual income). You want to underwrite anyway—this protects you and improves loan performance. TRID basics: Send a Loan Estimate (LE) ≥ 7 business days before closing and a Closing Disclosure (CD) ≥ 3 business days before closing. Disclosure reduces misunderstandings and defaults. Rules of 1 / 3 / 5 (why the myths persist): "1 per year": Only applies to natural persons selling their own primary residence (not investment deals or entities). Not the "do anything you want" rule most think it is. "3 per year": You can create up to 3 loans/year without involving an RMLO, but ATR still applies. Not Wild West. "5 per year": You can do up to 5 loans/year without TRID, but if you're already doing ATR with an RMLO, you'll typically do TRID too—there's no reason not to. Why follow ATR + TRID even when not strictly required: Better underwriting → fewer defaults Easier to sell (and at higher prices) to institutional buyers Enforceability if a borrower contests in court Costs are typically passed to the borrower at closing Servicing tip: For owner-occupied loans, use a third-party servicer. Compliance on servicing is even stricter, and you can contractually pass the monthly fee to the borrower. Resources mentioned 📄 One-Page Seller Finance Rule Guide (free) — quick reference you can keep on your desk 🤖 Note Copilot AI — my private GPT trained on 160+ sources (Note Launchpad transcripts, case studies, internal docs) to help you analyze, price, and operate notes in real time Events & shout-outs I'll be at Note Expo in Dallas, Nov 7–8 — great for networking (700+ people). Get your ticket HERE. Paper Trail Conference recap — smaller, intimate, lots of note creators Chapters (adjust timestamps after upload) 00:00 Intro & why seller finance feels confusing 01:10 Event updates (Note Expo, Paper Trail) 03:20 What is Note Copilot AI? 05:50 Seller finance compliance overview 06:30 Dodd-Frank ATR (what it really requires) 08:40 TRID timelines (LE/CD and why they help) 10:15 The 1 / 3 / 5 rules explained (and myths) 14:30 Why follow ATR+TRID even when not mandated 17:20 Servicing: why to outsource & pass fees 19:30 Wrap-up & how to get help Work with me / Get help Underwriting & compliance for seller-finance deals: Call The Underwriter Questions? [email protected]