Land Contracts vs Traditional Sales

[Karim Shah]

I'm looking to sell some rehabbed properties in SE Michigan. The properties are in B/C type neighbourhoods and I'm considering whether it will be easier and quicker to sell them using land contracts compared to conventional sales?

Does anybody have experience of swifter sales using LC's?

[Bill Gulley]

Hi, as Jon pointed out, any type of seller financing that is offered will generally bring more feet to your door. It is a proven marketing plus and jsut because you advertise that seller financing may be available is not a committment on your part to provide financing, but I'm not suggesting a bait and swithch thing either!

There are many comments on this site concerning LCs, Options and seller financing, I suggest you find them and read them, to include the new legal requirements for originations. Several cautions: 1. Make sure your buyer has the ability to perform and document that ability. 2. Make sure the sale price is in line with it's real current market value (selling for more than it's worth means that equity will not likely be established for your buyer to perform and pay it off in jsut a few years). 3. Even if you sue a contract for deed/LC, have title work done for the buyer (at their expense) and your contract will be subject to those liensat the contract date. 4. COnsider having the contract "serviced" where someone else collects payments and adminsters the contract, like ensuring taxes are paid and insurance is kept current. Servicing is about fifteen or twenty dollars a month and can be made an expense for the buyer.
Lastley, I doubt you will find a good installment contract on the internet, so find a good real estate attorney.

Advantages: more feet at the door, interest income from the deal and you string out the capital gain with such taxes being paid in cheaper future dollars (aasuming inflation..lol) Good Luck, Bill