Seller Finance interest terms

[John Dunbar]

Quick legal question. I was negotiating an owner finance deal today, and seller stated that he was advised that he is unable to give a 0% interest on the finance terms unless it was to "a family member". Is there any truth to this?

[Chris Seveney]

@John Dunbar if you sell at 0% he still will have to claim a set interest on his tax returns. So as a lender it makes zero sense to lend at 0% because you still are taxed at an interest rate set by the government on the loan.