Seller Financing an RV Park: How It Works for Sellers

Seller financing means you act as the bank. Instead of the buyer getting a loan and paying you everything at closing, they pay part of the price up front and the rest over time, with interest. For a lot of RV park owners, that turns a one-time sale into steady income.

How seller financing works

1. You and the buyer agree on a price and a down payment, paid at closing.
2. The rest becomes a loan from you to the buyer, written as a promissory note.
3. The note is secured by the park itself, through a mortgage or deed of trust, depending on your state. If the buyer stops paying, you can take the park back.
4. The buyer makes regular payments of principal and interest, often monthly, until the loan is paid off or a balloon payment comes due.

Why sellers choose it

• Income after the sale. Payments keep coming without guests, staff, or repairs to manage.
• Interest on your money. You earn interest on the unpaid balance.
• A bigger pool of buyers. Many capable buyers can’t get a bank loan for an RV park, or can’t get one quickly. Offering terms brings them in.
• A smoother sale. There’s no bank appraisal or loan approval to wait on.
• Possible tax benefits. An installment sale can spread some of your taxable gain over the years you’re paid. Some parts of the gain, like depreciation recapture, can still be taxed in the year of the sale, so get advice from your CPA.

The terms that matter

Term	What it means	What to think about
Down payment	Cash at closing	More down means the buyer has more to lose, which protects you
Interest rate	What the buyer pays on the balance	Market rates, the buyer’s risk, and IRS minimums
Amortization	The years payments are calculated over	Longer means smaller payments
Balloon	When the remaining balance comes due	Often 5 to 10 years, when the buyer refinances
Security	Your lien on the park	You want the first position
Guarantees	Who else is on the hook	A personal guarantee if the buyer is a company
Insurance and taxes	Who pays, and how you know	Proof every year, with you named on the policy
Default	What happens if payments stop	Notice, a cure period, and your remedies

A payment example

Example only: a $1,500,000 sale with 20% down. The buyer pays $300,000 at closing, and you carry a $1,200,000 note at 7% interest, calculated over 20 years.

• Monthly payment: about $9,300
• If the buyer pays the full 20 years, you collect about $1.03 million in interest on top of the price.
• With a 10-year balloon instead, the buyer pays off the remaining balance, about $801,000, in year 10.

The rate, term, and down payment are all negotiable. Change any one of them and the numbers change, so run your own scenarios with your accountant.

The risks, and how to protect yourself

The main risk is simple: the buyer stops paying. If you have to take the park back, it may be in worse shape than when you sold it. You can protect yourself with:

• A meaningful down payment. Buyers with real money in the deal work hard to keep it.
• A close look at the buyer: their experience running parks or similar businesses, their credit, and their finances.
• First-position security on the park, recorded properly.
• A personal guarantee when the buyer is an LLC or corporation.
• Insurance and property tax proof every year, with you named on the insurance.
• Reporting requirements, like yearly financial statements from the park.
• A real estate attorney to draft the note and security documents for your state.
• A loan servicing company to collect payments, track escrow, and send tax forms.

If you still have a mortgage on the park

Most commercial loans have a due-on-sale clause: when you sell, your lender wants to be paid off. That usually means your loan is paid from the buyer’s down payment at closing, which can require a larger down payment. More complicated setups, like wrapping your loan inside the buyer’s note, carry real risk. Talk to your lender and your attorney before you agree to anything.

Is seller financing right for you?

It’s often a good fit if:

• You don’t need all of the money right away
• You’d like steady income in retirement
• You own the park free and clear, or have a small loan balance
• You’re comfortable with some risk in exchange for a better price or interest income

It may not be the right fit if you need every dollar at closing, or if you don’t want any further connection to the park.

Cash, terms, or both

When you send us your park’s details, tell us how you’d like to be paid. We make all-cash offers and, where it fits, seller-financed offers. If you’re interested in terms, the written offer spells out the price, down payment, interest rate, term, and payments, so you can review them with your attorney and CPA. Wondering what price to expect first? Start with how buyers value RV parks.