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Land contract
A 'land contract' (sometimes known as a “contract for deed,” "agreement for deed," "land installment contract" or an “installment sale agreement”) is a contract between a seller and buyer of real property in which the seller provides financing to buyer to purchase the property for an agreed-upon purchase price and the buyer repays the loan in installments. Under a land contract, the seller retains the legal title to the property, while permitting the buyer to take possession of it for most purposes other than legal ownership. The sale price is typically paid in periodic installments, often with a balloon payment at the end to make the timelength of payments shorter than a corresponding fully amortized loan without a final balloon payment. When the full purchase price has been paid including any interest, the seller is obligated to convey legal title to the property to the buyer. An initial down payment from the buyer to the seller is usually also required by a land contract. The legal status of land contracts varies from region to region.
Since a land contract specifies the sale of a specific item of real estate between a seller and buyer, a land contract can be considered a special type of real estate contract. In the usual, more conventional real estate contracts, a seller does not provide a loan to the buyer; the contract either does not specify a loan or includes provisions for a loan from a different "third party" lender, usually a financial institution in practice. When third party lenders are involved, typically a lien called a mortgage or trust deed is placed on the property so that the value of the property is used as collateral until the loan is paid in full.
==Installment payments==
It is common for the installment payments of the purchase price to be similar to mortgage payments in amount and effect. The amount is often determined according to a mortgage amortization schedule. In effect, each installment payment is partial payment of the purchase price and partial payment of interest on the unpaid purchase price. This is similar to mortgage payments which are part repayment of the principal amount of the mortgage loan and part interest. As the buyer pays more toward the principal of the loan over time, his(her) equity (equitable title or equitable interest) in the property increases. For example, if a buyer pays a $2000 down payment and borrows $8000 for a $10000 parcel of land, and pays off in installments another $4000 of this loan (not including interest), the buyer has $6000 of equity in the land (which is 60% of the equitable title), but the seller holds legal title to the land as recorded in documentation (deeds) in a government recorder's office until the loan is completely paid off. However, if the buyer defaults on installment payments, the land contract may consider the failure to timely pay installments a breach of contract and the land equity may revert to the seller, depending on the land contract provisions.
Since land contracts can easily be written or modified by any seller or buyer; one may come across any variety of repayment plans. Interest only, negative amortizations, short balloons, extremely long amortizations just to name a few. It is not uncommon for land contracts to go unrecorded. For several reasons, the buyer or seller may decide that the contract is not to be recorded in the register of deeds. This does not make the contract invalid, but it does increase exposure to undesirable side effects. Some states, such as Minnesota, issue contracts without an acceleration clause, which in the case of a default leaves the seller in a position to either cancel the contract, discharging any principal deficiency, as in the case of deprecation, or to litigate for 18 months or more while letting the buyer, if not a corporation, retain their rights to the property while collection attempts are made, by which time the buyer will often qualify for bankruptcy, making the contract, when lacking said acceleration clause, effectively an installment option, when the buyer has no other lienable assets. In bankruptcy, some regions will interpret it as an executory contract that can be rejected, while others will treat it as a debt to be paid out of the bankruptcy trust. This and a wide variety of other legal ambiguities has led to a trend toward eliminating the use of Land Contracts to remove any incentives, and as a result, the disadvantages that these contracts have compared to the standard note and mortgage, which are more clearly defined in, and regulated by, law. 〔http://findarticles.com/p/articles/mi_qa3736/is_199801/ai_n8759824/pg_19/〕
抄文引用元・出典: フリー百科事典『 ウィキペディア（Wikipedia）』
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