How Does A Land Contract Work? (Contract for Deed Tutorial with Rocket Lawyer)

0:00 - Land Contract/Contract for Deed: What are they, and how do they work?
1:11 - RocketLawyer – What can they do for you?
1:36 - Consult with an attorney and check your state-specific requirements
2:18 - The process of setting up your Land Contract/Contract for Deed with RocketLawyer
16:37 - What if you want to change or edit your generated Land Contract/Contract for Deed?
17:00 - When recorded, return to?
17:33 - Plans & Pricing - RocketLawyer

There are several different financing "instruments” that can be used to close a seller-financed transaction. A Land Contract (sometimes known as a “contract for deed,” "articles of agreement for deed," "land installment contract," "bond for title," or “installment sale agreement”) is what I use in most of the states where I work.

A land contract isn't necessarily the right document to use in every state (because some states have laws and statutes that make it a difficult type of document to work with in the foreclosure process). Still, in many areas, it's a perfect fit for a seller-financed real estate transaction. In the states where it is used, there are variations on the specifics of what this document says, but they all accomplish the same general purpose.

How Does It Work?

With a Land Contract, the seller holds the legal title to the property for the entire term of the loan (i.e. - the deed won’t transfer to the new buyer until after the loan is paid in full), while allowing the buyer to take possession and use the property immediately after signing the land contract.

A land contract is typically more favorable for the seller because of the way title is held during the term of the loan. Still, fundamentally speaking, it’s not a huge variation from what usually happens in a typical lending/borrowing relationship.

If you’re financing your first deal, I recommend you take a few minutes to read this document carefully. Every state has differences in how this form is written, so you must understand exactly what you and your buyer are agreeing to.

As you read through this document, you’ll see that most of the information isn't surprising – but it will help you understand the responsibilities of both parties for the life of the loan.

Note: I have had a great experience with Rocket Lawyer, but your experience may vary. The link above is an affiliate link, and at no additional cost, I will earn a commission if you decide to purchase this particular tool/service. I recommend this resource because it is helpful and useful, not because of the small commission I make if you decide to buy it. Please do not spend your money on this unless you feel it will help you achieve your goals. #rocketlawyer #realestate #retipster #sellerfinancing #ownerfinancing #realestateinvesting

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[MusafirsSoul]

As always! Best person to share tiniest details with such simplicity!

[LandAcademy]

Great video, Seth! Thank you for sharing your knowledge with us regarding land contracts.

[BeatsPlanetMusic]

Awesome service brother. thanks for putting me on. will sign up soon using your link

[Tim_Krause]

thanks for the video Seth. Something interesting actually watch this video a year ago just when I was trying to absorb everything I could about land. But now that I'm probably a month or two away from actually using this information it's really great to be able to go over it again! Thank you for sharing.

[wildmanofborneo]

Hi, if the buyer defaults, what is the name of the court motion that the seller must file to regain physical possession (we already recorded the special warranty deed from buyer back to seller) ?

[AUPackmule]

Thanks again Seth. Another great resource for us followers. Your awesome.

[dialprospect]

In this scenario you were the seller; however, is this a form what you would create as well for sending out all offers that were accepted via a purchase agreement? After the purchase agreement is signed, then you could send via notary a land contract?

[hapowoverhere]

What kind of attorney would I hire to look at my raw land purchase?

[legacywithoutlimits]

This detailed tutorial was so helpful. God bless!

[georgiaoboma]

Can this contract be used for land wholesaling?

[ramirorodriguez]

What are you guys using to collect monthly payments on seller finance deals?

[criconinvestments]

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Is it possible for me to wholesale a property where my seller has a land contract and they're willing to sell via land contract?

[Its.Corey.]

Does this site allow you to save a contract that you compose so that you can edit it later if you need to? Good video, btw.

[margaritagonzalez]

Hi Seth great video! I’m in the Kent County area and really need your help. Is it possible to get a hold of you somehow?

[MusafirsSoul]

Escrow account? Is it setup by you inhouse?

[masoncanzoneri]

What do you do if the parcel has no address?