Land contracts are complicated. It is recommended that a lawyer be consulted before signing one.
Selected sections on drafting land contracts:
Land installment contract means an agreement under which the vendor agrees to convey title in real property located in this state to the vendee and the vendee agrees to pay the purchase price in installment payments, while the vendor retains title to the property as security for the vendee's obligation. Option contracts for the purchase of real property are not land installment contracts.
"Property" means real property located in this state improved by virtue of a dwelling having been erected on the real property.
The contract shall contain at least the following provisions:
(1) The names and addresses of all the parties to the contract;
(2) The date when the contract was signed by each party;
(3) A legal description of the property conveyed;
(4) The contract price of the property conveyed;
(5) Any charges or fees for services that are separate from the contract price;
(6) The amount of the vendee's down payment;
(7) The principal balance owed;
(8) The amount and due date of each installment payment;
(9) The interest rate on the unpaid balance and the method of computing the rate;
(10) A statement of any encumbrances against the property conveyed;
(11) A statement requiring the vendor to deliver a deed on completion of the contract;
(12) A provision that the vendor provide evidence of title in accordance with the prevailing custom in the area in which the property is located;
(13) A provision that, if the vendor defaults on any mortgage on the property, the vendee can pay on that mortgage and receive credit on the land installment contract;
(14) A provision that the vendor shall cause a copy of the contract to be recorded;
(15) A requirement that the vendee be responsible for the payment of taxes, assessments, and other charges against the property from the date of the contract, unless agreed to the contrary;
(16) A statement of any pending order of any public agency against the property.