What is a land contract?

Answer 1

Well, it could be a contract to purchase the land. It could be a contract for a ground lease. It could be any contract that bindes or gives rights to someone or an entity to the land. There are loads of ways this can happen.

Answer 2

A land contract, also called a "contract for deed" is an agreement where you pay a property owner a set amount per month for a period of years and acquire title to the property at the end of the agreed period of time.

Land contracts CAN be a good deal but are rife with pitfalls, mostly for the buyer. Your agreement should state that the owner may not encumber the property (take out a mortgage on it) and must keep the property tax payments current and provide copies of the property tax receipts to you and/or allow you to pay the property taxes and deduct them from your payments to the owner. A friend of mine recently discovered that the home that she thought she owned had 10 years of mortgage payments left to run from the seller -- and that the seller had stopped making mortgage payments. The quitclaim deed she received isn't worth the paper it's printed on.

It should also provide a reasonable grace period for making late payments without terminating the agreement and converting it to an ordinary lease -- many unscruplous property owners will enter into a contract for deed and cancel the agreement as soon as a single payment is a single day late.

You should never enter into a contract for deed agreement until it's been reviewied by an attorney who specializes in real estate law.

Answer 3

I think it is a contract between you and the owner of the property. Upon fulfillment of the terms of the contract he will give you the deed to the property.