What is the interest rate on a land contract in Michigan?
It is possible for the interest rate to change over time, but the average interest rate has to be 11% or less. In general, the buyer is in charge of making all repairs and paying property taxes in most land contracts.
Is land contract legal in Michigan?
A land contract is an agreement between a buyer and a seller that states the buyer is purchasing property but will not receive the legal title until the debt has been satisfied. Land contracts are legal and binding in Michigan and must be in writing in order to be enforced.
Does a land contract have to be notarized in Michigan?
A land contract is not legally required to be recorded in Michigan. However, both the buyer and the seller may wish to record the contract to protect their interests in the property. The land contract should be signed in front of a notary public or local judge. Contracts do not need to be notarized to be binding.
Are land contracts worth it?
A land contract can be an appealing option for a potential homebuyer who might have difficulty qualifying for a mortgage loan. But there are potential risks to be wary of as well. Instead of taking out a mortgage, the buyer agrees to make regular payments directly to the seller, who still retains title to the property.
Can I sell house while under a land contract?
You can sell your house on a land contract with an outstanding loan balance if your lender agrees and if the contract doesn’t have a due-on-sale clause. A land contract, sometimes also called a contract for deed or installment sale, is an agreement between you and the buyer.
What is a land contract or seller financing?
A land contract is a form of seller financing. It is similar to a mortgage, but rather than borrowing money from a lender or bank to buy real estate, the buyer makes payments to the real estate owner, or seller, until the purchase price is paid in full.
What is a land contract agreement in Michigan?
A land contract in Michigan consists of an agreement between two parties concerning the purchase of property. The purchase price is commonly paid in installments until satisfied. A land contract will often refer to the seller as the vendor and to the buyer as the vendee.
