Owner financing in North Carolina: a guide for the seller who carries the note
If you sold North Carolina property and carried the note, North Carolina law puts your payment record at the center of things: a power-of-sale foreclosure requires an itemized statement of what is owed, and a contract for deed requires a statement to the buyer every year.
Deed of trust and foreclosure before the clerk
A North Carolina deed of trust or mortgage with a power of sale is foreclosed at a hearing before the clerk of superior court, who must find a valid debt held by the party foreclosing, a default, the right to foreclose, and proper notice. Notice of the hearing must be served at least 10 days before it, or 20 days where notice is posted on the property (N.C.G.S. § 45-21.16).
The notice must also confirm that, within 30 days of its date, the debtor was sent by first-class mail a detailed statement of the principal, interest and other fees, expenses and disbursements claimed, with a daily interest charge at the contract rate (N.C.G.S. § 45-21.16). That statement is your ledger, itemized. If you cannot produce it, you cannot foreclose.
Contracts for deed (Chapter 47H)
North Carolina regulates contracts for deed in Chapter 47H. The seller must record the contract, or a memorandum of it, within five business days after both parties sign (N.C.G.S. § 47H-2).
At least once every 12 months the seller must give the buyer a statement showing the amount paid, the amount still owed, the number of payments remaining, and the taxes and insurance paid or collected, along with any insurance proceeds and the balance of any underlying loan (N.C.G.S. § 47H-5). That statement is only as good as the payment record behind it.
Late fees are capped at 4 percent of the late payment and may be charged only when the payment is more than 15 days late (N.C.G.S. § 47H-7). Before a seller can declare a forfeiture, the buyer gets a notice of default with an itemized statement and at least 30 days to cure (N.C.G.S. §§ 47H-3, 47H-4).
Licensing
North Carolina's mortgage licensing act exempts an individual who seller-finances the dwelling that was their own residence, and a seller who receives no more than three residential mortgage loans as security for purchase-money obligations in a calendar year (N.C.G.S. § 53-244.040). The section was amended in 2025, so check the current text before relying on a particular subdivision.
Federal rules count seller-financed sales separately; see RMLO licensing thresholds and the de minimis exemption.
The record every North Carolina seller needs
Whatever the structure, the rules above all lean on the same thing: a complete record of every payment, the date it arrived, and how it was split between late fees, interest, principal and escrow. OwnerNote keeps that record. You log each payment as it arrives, and it applies every one the same way, keeps the balance current, produces payoff quotes good through any date, totals the year's interest, and prints statements for any period.
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