Creative Investing

A creative way to purchase a property when a traditional loan or a non-conforming loan is not available to the buyer is the land contract. A Land contract structure basically allows the buyer to make periodic or monthly payments to the seller with-out transferring tittle to the property, transfer only occurs when buyer has fulfill all the obligations established under the Land Contract. Another advantage to a land contract is that there are minimal closing costs and will help buyer to establish a good payment record and improve the credit score and rating, normally this is done with the intention to refinance at a later time to a traditional or non-conforming loan. There are some risk associated with land contracts since is no way to make sure that seller will be able to transfer good and clear tile to buyer after the buyer has fulfill all his obligations, also need to remember that since no lender is involved no inspections or appraisals are required. Another option will be assuming the sellers existing mortgage if loan is assumable and may allow buyer to obtain a better interest rate.