According to OurValleyHomes.com, Remax Realtor's Ohio site, it is illegal for real estate agents to write a land contract unless they are licensed attorneys in Ohio. However, Realtors are still willing to work with buyers and sellers to assist the process.Continue Reading
Land installment contracts allow the seller to keep the legal title to the property while the buyer receives the equitable title. The buyer makes a down payment of 10 to 20 percent of the purchase price and continues to pay about 1 percent of the remaining balance monthly. These payments continue for about five years or until another condition is met, such as fulfillment of a certain payment requirement. At that time, the seller transfers the legal title to the purchaser.
Land contracts can be risky for both buyer and seller. According to AvoidForeclosureOhio.org, many buyers who enter into a land contract do so because they are unable to obtain a traditional mortgage loan. Land contracts offer the buyer an opportunity to improve her credit score while investing in a new home, which increases her likelihood of receiving a mortgage in the future. However, land contracts are typically less forgiving than traditional mortgages when a buyer is late on a payment, which increases the risk factor of the contract for all parties.Learn more about Real Estate