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Home on Land Contract?

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Home on Land Contract?

We lost our home last year. We put $90,000 down and still lost it.Signed over deed to bank. My husband and I are on a fixed income of $4000 a month.I have saved $10,000 since we started renting our townhouse last June.

My credit score is 546-My husbands score is 518 - we have collections and a judgment.

We have an appointment with GreenPath next Tuesday and my question is what do we do to repair the damage.

My husband is a disabled Vet and he is devastated we collapsed financially.Our mortage payment went from $1000 per month to $2300.00

So we stopped paying on our credit cards and lost the house anyway. Horrible.

I am scared to death Chapter 13 would take all our money per month and we would save nothing for years-and we are running out of years.I am hoping we can pay off the cards one by one. I am 54-hubby is 60. I dream of having a home again. Nothing fancy-just a beautiful little place to call our own. I see land contract offers and get tempted.

I guess my question is: While we rebuild our credit would a home on land contract be possible and/or smart?In our area in Michigan a nice home runs about $130,000

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Re: Home on Land Contract?

Your situation is a very prominent reason for land contracts aka contract for deed aka rent to own.


There isn't anything preventing you from buying under this type of contract.  however, you must be vary careful, there are many "predatory" types out there selling under those contracts.  Have an attorney review it.  Make sure it is compliant with current state law.


Some of these contracts have default clauses which allow the seller to convert the contract to a rental agreement and evict you.....keeping ALL down payments, payments, etc. as "Liquidated damages and rent" and you walk away with nothing to show.....your $90,000 home loss all over.


These contracts have real pitfalls and for those states that have created some protections, many of the protections don't kick in till you have paid a substantial amount of the contract (like 40%) or made many years of payments (like 4 or more).  In Texas, after 4 years or 40% there are statutory equity protections.

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