A land contract is a contract between a buyer and seller for real estate in which the seller provides the financing to buy the property at an agreed upon price. Generally, the seller retains title to the property while allowing the buyer to take possession. The buyer then makes scheduled payments, with or without interest to the seller until the purchase price is paid in full. An initial down payment from the buyer to the seller is usually required. Land Contracts offer benefits to a buyer who might not otherwise be able to obtain financing. The seller may have more potential buyers by offering the property for sale under land contract, but assumes all the requirements and risks a bank may encounter.
A lease is a contract by which one party conveys rights in land, property, services to another for a specified duration, usually in return for specific periodic payment. A lease is for a specific term and one year is a common term. Some may be as short as six months, others as long as five years.
A real estate purchase contract is a binding, bilateral agreement between two or more parties with legal capacity for the purchase, exchange or other conveyance of real property. The purchase contract contains the specific terms of purchase and must include the following:
Identity of the competent parties;
The property address;
The purchase price;
Meeting of the minds;
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