What is an installment land contract?

An installment land contract is a financing agreement in which the buyer agrees to purchase property by making regular installment payments to the seller. During the life of the contract, the buyer typically lives on and may have some use of the property, but the legal title does not transfer to them until they finish paying off the total purchase price. This arrangement allows buyers to gradually pay off the property while the seller retains the title until all payments are complete. This type of financing is beneficial for buyers who may have difficulty securing traditional mortgages or need time to improve their financial situation.

The other options describe different types of agreements. A short-term lease agreement pertains to renting property for a limited duration, a type of rental contract involves the leasing of property without an intention to purchase, and a contract for purchase at a later date indicates an agreement that might not involve installment payments or the nuances of financing as seen in an installment land contract.