Loan Servicing
Owner Finance Note Servicing
We collect the payment, handle statements, escrow, and reporting, and become the borrower's point of contact, so you are not chasing money from someone you know.
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What is owner finance note servicing?
Owner finance note servicing is when a professional third party handles the day-to-day collection and administration of a seller-financed (owner finance) note - payment processing, statements, escrow, and reporting. By letting a third-party servicer collect, the borrower treats the payments as a business transaction instead of a personal issue between buyer and seller.
Owner financing, also called seller financing, is common in Texas land and home deals where the seller carries the note instead of a bank. It works well until collecting the payment every month starts to feel personal. A third-party servicer steps in between the buyer and the seller so it stays a business arrangement.
Cedar Top handles the accounting, monthly statements, escrow for taxes and insurance, and IRS reporting, and we become the borrower's point of contact. You stay the note holder and keep getting paid. We handle the collection and the paperwork so you do not have to chase a payment from someone you may know personally.
What's included
- Payments
- Accounting, processing, and auto-draft or web payment options
- Statements
- Monthly statements for both lender and borrower
- Escrow
- Insurance and property-tax collection, disbursement, and analysis
- Reporting
- IRS reporting on your note
- Account access
- Real-time account information online, for both parties
- Onboarding
- Borrower welcome and first-payment letter handled for you
How servicing works
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Send us your note details
Share your loan documents and how the note is set up. We will tell you exactly what we need to get started.
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We board the loan
We review the terms, set up the account, and configure escrow, reporting, and payment options to match your note.
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We onboard the borrower
The borrower gets a welcome and first-payment letter with their payment options. From there, we are their primary point of contact.
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We service every payment
Payment accounting and processing, monthly statements, escrow for taxes and insurance, late notices, and IRS reporting - handled for you.
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You get paid and stay informed
Funds are distributed on time, and both lender and borrower get real-time account access online.
Onboarding documents
Every note is different. Depending on the loan and how it is set up, we may need more than this.
- Promissory Note
- Deed of Trust
- Closing Disclosure or HUD-1
- Truth-in-Lending
- Sales Contract
- 1003 or Borrower Application
- W-9
- First Payment Letter
- Homeowners Insurance
- Tax Certificate
What it costs and how to get set up
Setup and pricing depend on the note and how it is structured. Send us your note and closing documents and we will confirm what we need to board the loan and what servicing costs to get started. Cedar Top services Texas notes and does not provide tax or legal advice - keep your CPA and attorney involved on the note itself.
FAQs
What changes for the buyer when a servicer steps in?
The buyer gets a welcome and first-payment letter, then pays us instead of you. Payments post to the account, statements go to both sides, and you stop being the one who has to call about a late payment.
How do borrowers make payments?
Borrowers can pay by automatic bank draft, online, or by mailed check. We process the payment, post it to the account, and send statements to both sides.
Do you handle insurance and property tax?
We handle Insurance and Property Tax Disbursement and Escrow Analysis. Send your loan details and we will confirm how your note is set up.
Do you report to the IRS?
Yes. We handle IRS reporting on the note. Send your loan details and we will confirm what applies to your situation.
Can you take over a note I already have?
Yes. We onboard existing owner finance notes. Send your note and closing documents and we will set up the account.
How long does onboarding take?
It depends on how complete your loan documents are. Once we have the note, deed of trust, and the other onboarding documents, we review the terms, board the loan, set up the account, and send the borrower a welcome and first-payment letter. Send your documents and we will give you a timeline.
How do payments reach me?
We collect the borrower payment, post it to the account, and distribute funds to you by the method set up during onboarding. Both you and the borrower also get real-time online account access to see payments as they post.
Do you service notes outside Texas?
Cedar Top focuses on Texas notes. If your note is outside Texas, contact us and we will tell you whether we can help.
Set up servicing on your note
Fill out the loan servicing inquiry form with general details and our team will follow up with onboarding steps.