Glossary · FINANCING

Seller Carry

The portion of the purchase price the seller agrees to finance directly, rather than requiring full cash payment.

Seller carry refers to the debt the seller holds on the property after closing - the amount of the purchase price they have agreed to finance. A $500,000 sale with $30,000 down and $470,000 seller carry means the seller effectively loaned the buyer $470,000 secured by the property. The seller carry amount is documented in the promissory note and secured by a deed of trust or mortgage. It may be in first position (only debt on the property) or second position (behind a bank loan). Seller carry is also used to bridge valuation gaps in commercial deals: buyer gets bank financing for 60% and seller carries 20%, with 20% equity from the buyer.

Related Terms

Capital Stack

The layered structure of debt and equity funding a real estate deal, from senior debt at the bottom

Debt Service

The total annual principal and interest payments required on all loans secured by a property.

Promissory Note

A signed legal document in which the borrower promises to repay a specific amount under defined term

Seller Financing

A transaction where the property seller provides the loan directly, eliminating the need for a tradi

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