Let’s face it. Due to foreclosures, short sales, job losses and tightened lending standards, fewer prospective duplex buyers can qualify for loans.
Ultimately, this translates to fewer potential buyers for properties, which contributes to declines in value.
Months and months ago I predicted we’d see the re-emergence of the contract for deed as a financing option. In recent days and weeks, I’ve begun to see just exactly that.
A contract for deed, which is sometimes called a land contract, is a means of financing a property in which the seller becomes the bank.
Of course, acting as the bank for a buyer carries inherent risks and rewards for a seller.
The risks of carrying a contract for deed can be:
Having weighed both the benefits and liabilities, many traditional sellers are finding a contract for deed to be a way to solve the problem of being stuck in a property they no longer care to own.