Make sure the Land Contract specifies payment terms – including repayment amount, interest rate, and any late fees charged.
Payment terms may involve a down payment or a balloon payment.
Pay attention to default provisions or prepayment clauses.
The interest rate for a Land Contract cannot exceed 11%.
The Land Contract should specify the date of possession. Typically, possession occurs at closing, but parties are free to negotiate terms of possession.
Remember that a Land Contract does not convey legal title to the purchaser, instead the purchaser acquires equitable title with the right of possession.
Check for a clause requiring the Seller to prepare and convey a deed once the Land Contract is paid in full.
Once the land contract has been paid in full, the Purchaser is entitled to a deed from the Seller conveying legal title to the property.
Both parties should confirm whether there are any limits on either parties’ ability to mortgage the property.
Both the Seller and Purchaser have the right to grant a land contract mortgage.
Who pays property taxes? Typically, the Purchase is responsible for paying the property taxes on a Land Contract, so the agreement should contain a clause to that effect.
Land Contract transactions must still comply with State law governing lead paid disclosure and seller disclosures
As with any other sale of property, a purchase agreement is essential.
It is always recommended that a Purchaser have the property inspected, regardless of seller disclosures.
Do not forget to file the necessary Affidavits with the Township Assessors office. That includes:
Property Transfer Affidavit – required to be filed within 45 days of the transfer of property
Principal Residence Exemption – if the Purchaser is claiming the property as Principal Residence
Rescind of Principal Residence – if the Seller had held the property as their Principal Residence prior to the sale
https://accesstitleagency.com/wp-content/uploads/2021/11/Alicia-Kellogg.jpg300240adminhttps://accesstitleagency.com/wp-content/uploads/2022/03/acces-title-logolinkedin.jpgadmin2022-05-03 18:22:082022-05-03 18:22:08Tips for a Land Contracts: