A land contract is a contract between the buyer and a private seller of a property. The seller holds the deed to the property until all agreed upon payments have been made in full. This property may be improved upon if buyer wishes within the term of the contract. With a land contract, a down payment is usually made, then equal monthly installments are paid until the property is paid for or until a balloon payment is required.

Land contracts are not always the best route to take when buying a home because of the many flaws that can result between buyer and seller.

A land contract is a good option to use when your credit is not quite where it needs to be to qualify for good financing terms. By buying a home by land contract, it enables you to become a homeowner now instead of waiting until your credit improves and buys you some time to take care of your credit problems and improve your credit scores. By improving your scores this will allow you to finance the house, usually within 12-24 months, solely in your name and get the previous owners name off of the deed to the property so that you are now the proud owner of that home.

 

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