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Land Contract – Installment Sale
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Agreement For Deed or Contract for Deed

The term “Agreement For Deed” is also known as a “Land Contract”, “Installment Sales Contract”, or a “Contract For Deed”. They are all basically the exact same thing, but for the purposes of this course, we’ll refer to it as an “Agreement For Deed”.

What Is An Agreement For Deed?

An Agreement For Deed is basically seller financing where the seller gives the buyer the deed to the property after the buyer has paid for the property through monthly installments. Some agreements state that the seller will convey the deed and convert to out right seller financing, once the buyer has made a certain number of payments as agreed.

Buying Under an Agreement For Deed

If you’re looking to buy a home or investment property by putting little or no money down and without qualifying, Agreement For Deeds are a great way to do it. It is fairly easy to get a motivated seller to do an Agreement For Deed even if the seller is concerned about their credit or concerned about the due-on-sale clause. The seller can feel more in control with the fact that the deed hasn’t transferred yet. This is important to some sellers who are concerned about you not following through with your side of the agreement.

As a buyer, it is important to know that many banks will allow you to refinance an agreement as if you had a regular seller financed mortgage. This can be very helpful if you need time to build up your credit and want to get into a home now without needing a large down payment. And with a refinance loan you don’t put money down like you would on a normal purchase loan.

This means that you could purchase the property under an Agreement For Deed from the seller using no money down, then later refinance the Agreement For Deed and pay th~ seller off. As part of the refinance, you can also roll the closing costs into the loan and not only close using no money, but it is possible you could actually walk away from closing with money in your pocket.

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