| Advantages of Land Contracts for the | | | | will not have this expense when you buy on a |
| buyer:Buying property using a land contract | | | | Land Contract. If the seller feels she needs |
| may benefit you if you have a difficult time | | | | a higher yield, she should have insisted on a |
| finding bank financing due to credit problems | | | | higher interest rate when you were |
| or have non-traditional income sources. In | | | | negotiating your purchase |
| that case, without the use of a Land | | | | agreement.Advantages of Land Contracts for |
| Contract, buying your home would be much more | | | | the seller:A Land Contract allows the seller |
| difficult.Won't your income and savings, | | | | to make additional money on the financing of |
| crucial aspects of your financial status, and | | | | the sale of their property, collecting not |
| your ability to handle more debt (a mortgage | | | | only the purchase amount but also the |
| loan) increase in the coming years? Of course | | | | interest on the principal balance. By acting |
| they will! But a lender bases its decision on | | | | as the bank in the property transaction, she |
| what you make NOW, and what you have saved | | | | gets to make the profit as the bank |
| NOW. Many individual sellers, on the other | | | | "normally" would.Selling a home on Land |
| hand, will recognize that your financial | | | | Contract when you have an underlying mortgage |
| future is indeed bright.Many of the usual | | | | loan is a time-honored method of profiting in |
| closing costs are eliminated when you use a | | | | the residential real estate market. The Land |
| Land Contract to complete your real estate | | | | Contract payment will usually far exceed the |
| sales transaction. Purchasing a title | | | | mortgage loan payment amount, due to |
| insurance policy for the lender is not an | | | | appreciation.When a home is sold using a Land |
| applicable cost when there is no bank | | | | Contract, the seller retains ownership |
| involvment in the transaction.Also, you | | | | rights. She can pledge the equity in the home |
| probably don't need to pay for a new survey | | | | as collateral, or even get a bank loan in the |
| if you are buying a home in an established, | | | | amount of the principal balance.There are |
| platted subdivision. There is no need for an | | | | considerable advantages of land contracts for |
| appraisal, either. You and the seller have | | | | both the buyer and seller when a Land |
| already agreed upon the value of the home. | | | | Contract is used to convey the property. |
| Neither of you are concerned anymore about | | | | Another factor that can benefit both buyer |
| the prices that comparable homes have sold | | | | and seller is the fact that the sale can be |
| for in the area.The single biggest closing | | | | closed tremendously faster. It is not unusual |
| cost is usually the discount points charged | | | | for a Land Contract transaction to be closed |
| by the bank to increase its yield, or its | | | | within a few weeks of the final signing of |
| profit from the interest on the loan. You | | | | the sales agreement. |