Wanezek, Jaekels, Daul & Babcock, S.C. Attorneys at Law — Founded 1908


A land contract is a contract between a buyer and seller of real property wherein the seller provides financing to buy the property. There is usually not a lending institution involved. Under this arrangement, the seller actually retains the “legal title” to the property while allowing the buyer to take possession of it in transferring “equitable title”. The sale price is typically paid in periodic installments, often with a balloon payment. When the payment price has been paid, the seller is obligated to convey all legal title of the property to the buyer.

Land contracts are often used where the buyer cannot obtain conventional financing or when the buyer is a person of close relationship to the seller. There are, however, many risks for both the buyer and the seller in such circumstances. For instance, if there is a mortgage recorded against the property from a conventional lending institution, the land contract will be subordinate to the first place conventional loan. Also, if the seller of the real estate does not obtain the consent of the senior place mortgage holder, the “due on sale” clause involved in the applicable mortgage documents may require payment of the remaining balance on the mortgages as soon as equitable title is transferred. Therefore, it is crucial to have consultations with the first place mortgage holder if the land contract is considered. Buyers attempting land contracts without the assistance of an attorney may be unaware that there other mortgage loans recorded against the property!

Land contracts often give rise to legal disputes; therefore, it is extremely advisable to have an attorney assist you in either offering or accepting a land contract. Often these transactions are attempted by friends and family thinking that the matter can be handled informally and easily. However, the reality of the matter is that there are often complex issues that the parties are unaware of that are implicated in transferring equitable title in a land contract

In Green Bay, please consult with one of the attorneys at Wanezek & Jaekels, S.C., including Attorney David Daul, with regard to the issues associated with a land contract before entering into such an arrangement. Our attorneys are experienced in all aspects of land contacts and other real estate and property matters. Call 1.920.437.8191 for a consultation.