Question

The CD and LE aren't required in a seller-financed transaction.

In a seller-financed transaction, the LE and CD aren't required. Some other form of statement may be prepared to show the buyer and the seller their respective closing figures.

Answer 1

The CD (Closing Disclosure) and LE (Loan Estimate) are not required in seller-financed real estate transactions, but alternative disclosure documents typically summarize the closing figures for the buyer and seller.

Step-by-step explanation:

The CD (Closing Disclosure) and LE (Loan Estimate) are typical documents used in real estate transactions with traditional financing from financial institutions, as required by the Truth in Lending Act (TILA) and the Real Estate Settlement Procedures Act (RESPA). In a seller-financed transaction, where the seller offers credit to the buyer for the purchase of the property, these specific documents are not mandated by federal law. However, some form of disclosure statement is usually prepared, which provides a summary of the closing figures for both the buyer and the seller. This could include details such as the loan amount, interest rate, repayment schedule, and other terms specific to the private transaction.