Question

what is the difference between a contract for deed and standard purchase agreement?

Answer 1

A contract for deed is a tool that can allow buyers who either don't qualify for traditional lending options or who want a faster financing option to purchase property.

Under this concept, the buyer makes regular payments to the seller untill the anount owed is paid in full or the buyer finds another means to pay off the balance. The seller retains the title of the property untill the balance is paid, the title of the property is passed on to the buyer once payment is done or final amount is paid. If there is any default in payment then in such case the seller can repossess the property.

In case of standard purchase agreement terms and conditions related to sale of goods are included. It is a legally binding contract between buyer and seller. These agreements normally relates to buying and selling of goods instead of services. Usually purchase agreement are used when the purchase price is more than 500 dollar, but may be used for small transaction. They are common in real estate and home sales.