How does a contract for deed work?
Get Legal Help Today
Compare Quotes From Top Companies and Save
Secured with SHA-256 Encryption
How does a contract for deed work?
And what if the other person doesn’t pay, what happens?
Asked on July 30, 2011 South Dakota
Answers:
FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
Your question is somewhat vague. I assume you want to know how a real property sales contract works where when the sale closes, the buyer ends up with legal title to the real property.
When a person who owns real property of record want to sell it, it is typically listed for sale by a real estate agent. People look at the property and make an offer. Before the sale happens, the buyer typically has third party experts inspect the property for problems, gets the loan application if needed in order, sets up an escrow to get the sale closed, reviews title documents (prelimary report), signs documents for the loan, review disclosures, and gets ready to close escrow.
The seller reviews the closing documents as well and signs a deed to transfer legal title to the new buyer which is recorded with the county recorder's office.
If the buyer fails to close the escrow where title transfers due to inability to pay the purchase price, given the circumstances, the seller may end up suing the buyer for the difference in sales price he or she has to a subsequent buyer that closes escrow on the property.
IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.