RV Park Seller Financing Deal Structurer — What Would You Actually Earn?

Deal structure inputs

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Sale Price $2,000,000

$200K$10M

Down Payment 20% — $400,000

10%50%

Received at closing

Interest Rate on Note 6.0%

3%12%

Annual rate on the seller carry note

Amortization Period 25 years

10 yrs30 yrs

What the monthly payment is calculated on

Balloon Term 7 years

2 yrs20 yrs

When full remaining balance is due

Estimated Gain on Sale 60% — $1,200,000

10%95%

Gross gain ÷ sale price — used for tax illustration only. Consult your CPA for your actual basis.

Monthly payment to you as the lender

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Down at closing

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Received immediately

Note balance

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Principal financed

Balloon payment

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Total interest earned

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Over full note term

Annual yield on note

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Return on financed amount

Total gross received

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Down + payments + balloon

How your proceeds arrive over time

Down
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Monthly payments
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Balloon
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Down payment at closing

Monthly P&I stream

Balloon at term end

Year-by-year: what you receive from the note

Amber = principal, dark = interest

All-cash sale vs. seller financing — illustrated comparison

Tax estimates use simplified installment sale math. Your actual outcome depends on your basis, depreciation history, and state taxes. Consult your CPA.

All-Cash Sale

Gross sale price—

Estimated taxable gain—

Estimated tax (23.8%)—

Est. net after tax—

Seller Financing

Gross sale price—

Total interest earned—

Tax yr 1 (installment)—

Total gross + interest—

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Important: Tax figures above are simplified illustrations only — not tax advice. The all-cash tax estimate uses a blended 23.8% federal rate (20% long-term capital gains + 3.8% NIIT) applied to the estimated gain. The installment sale figure shows only year-1 federal tax on the down payment portion. Your actual tax depends on your adjusted basis, depreciation recapture (taxed at up to 25%), state income taxes, your overall tax picture, and the structure of the installment agreement. Before making any decision based on tax treatment, speak with a CPA or tax attorney who knows your specific situation.

What carrying the note actually means — and why serious sellers consider it

When you sell your RV park and carry the note, you become the bank. The buyer pays you a down payment at closing, then makes monthly principal and interest payments to you — just like they'd make to a lender — until the balloon payment is due at the end of the note term. You hold a first lien deed of trust on the property, which means if the buyer defaults, you get the property back through foreclosure.

The financial case for carrying the note is straightforward: you earn interest on top of your sale price. On a $1.6 million note at 6% over 7 years, you receive approximately $350,000 to $400,000 in interest above the principal. That interest is income that doesn't exist in an all-cash sale. When you factor in installment sale tax treatment — which spreads capital gains recognition across the years payments are received — the after-tax comparison often favors carrying the note, sometimes significantly.

The risk is that the buyer stops paying. That's why down payment size matters — a buyer who's put 20% to 30% down has real skin in the game and is unlikely to walk away. And if they do, you foreclose and recover the property, ideally at a value above the outstanding balance you're owed.

Advantages and real risks of seller financing

You earn interest above your sale priceEvery dollar of principal you finance earns interest income over the note term. A $1.6M note at 6% over 7 years generates $350K+ in interest you would not receive in an all-cash sale.

Installment sale tax treatmentYou only recognize gain proportionally as payments are received — rather than paying the full tax in year one. This can meaningfully reduce your first-year tax liability and improve overall after-tax returns.

Larger buyer pool and faster closeBuyers who can't secure full bank financing can still purchase your park if you carry. More buyers competing for your park typically means a better price — and seller-carry deals often close in 30 days or less.

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Default riskIf the buyer stops paying, you must foreclose to recover the property. Foreclosure takes time and costs money. Mitigate this by requiring a meaningful down payment and reviewing the buyer's financials before agreeing to carry.

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You remain in a lender role for yearsYou'll receive monthly payments and manage the note until the balloon is paid. This is passive income — not active work — but it is a financial relationship that requires monitoring.

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Balloon risk for the buyerIf the buyer can't refinance at the balloon date, they may default. Structure the balloon term generously — 7 to 10 years gives the buyer time to build equity and demonstrates willingness to a conventional lender.

Seller financing deal structurer — what would you actually earn if you carried the note?

Deal structure inputs

Year-by-year: what you receive from the note

All-cash sale vs. seller financing — illustrated comparison

What carrying the note actually means — and why serious sellers consider it

Advantages and real risks of seller financing

Keep exploring your options

Seller Financing — Complete Owner Guide

Tax Implications of Selling an RV Park

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