3 Things To Know When Buying A House On Land Contract
Buying a home is a dream many people have, but it does not always become a reality with everyone. If you are having a hard time buying a home because of your credit or lack of down payment money, you might want to consider buying a house on contract. A land contract is a deal that could be highly beneficial for you at this time, and you can find homes for sale on contract by contacting a real estate agent. Here are three things to understand about land contract deals.
What Is A Land Contract Deal?
A land contract deal occurs when a homeowner sells his or her home to a third party. The current homeowner keeps the loan in his or her name, and the buyer of the home makes payments to the homeowner. This means the new buyer of the home does not need to get a loan. This is why people often look for land contracts when:
- They have bad credit
- They have very little money for a down payment
- A bank will not approve a loan for any reason
When this deal takes place, the new buyer takes full possession and ownership of the home. This means the new buyer is responsible for the taxes, insurance, and maintenance on the house.
Both buyers and sellers can benefit from this arrangement. A buyer will be able to own a home without getting a loan, and a seller will be able to sell his or her home with this alternative method if standard methods of selling a home are not working.
How Can A Real Estate Agent Help?
A real estate agent does not necessarily have to be involved in a land contract deal; however, there are several ways realty services can help during a deal like this, including that they can:
- Help people find homes for sale on contract
- Help sellers find buyers for homes on contract
- Negotiate terms of the deal
- Offer advice and tips for both buyers and sellers
- Complete the legwork needed for the sale
- Research property to determine if there are any liens on it
If you want to buy a home on contract, you can call a real estate agent for help. While agents typically do not use this method for making money, there are times when homeowners might be willing to pay an agent for help selling a house on contract. Because of this, agents may have firsthand knowledge about homes that are for sale with land contracts.
Will You Need A Lawyer?
Even if you use a real estate agent to find a land contract deal, you should still hire a real estate lawyer to assist you with this process. The lawyer will make sure the contract is legal and valid, and he or she will make sure it meticulously lists all the terms, requirements, and obligations of both parties. The contract should include:
- The purchase price of the home
- The amount needed for a down payment
- The interest rate and payment amount
- The length of the loan, including details of a balloon payment due in a certain number of years
- The names of those responsible for paying the mortgage, and the names of those responsible for paying the bills of the house
Before you sign the contract, you should carefully read through it to make sure it is accurate. Buying a house on land contract is a great way to own a house without getting a loan. If this is something you are interested in, you might be able to find homes for sale like this by contacting a company that offers realty services.