What are the basics of a contract for deed incluing the answers to ...?

Asked by Reseeker, Minnesota Sat Oct 6, 2007

(1) Are there 1 or 2 closings?, (2) Who is on the property title during the term of the contract?, (3) What if there is a mortgage on the property when a you sell by contract for deed? (4) Is it usual for the buyer on the contract to pay the insurance and taxes?, (5) Is any downpayment usable by the seller or does it go into escrow?, (6) If the buyer defaults, does the downpayment get returned?, and (7) whatever other things would be helpful to understand this type of contract and the steps to complete the sale.

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Dave Rivera &…, Agent, San Francisco, CA
Sat Oct 6, 2007
I am currently studying for my Brokers exam, and this is my understanding:
The buyer has equitable title only, until the payments are finished, and then receives legal title.
The seller uses the buyers payments to pay the mortgage, taxes, etc.
If the buyer defaults, the seller needs to file action to clear the cloud on title
Never having been involved in one of these, that's about all I can tell you, but I hope it helps!
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