Land Contract Template

Create a high quality document online now!

A land contract outlines an agreement for the purchase of land between a buyer and a seller. Depending on the terms between the parties, a contract will commonly include a purchase price and a closing date. If the buyer does not purchase by the closing date, any earnest money deposit may be kept by the seller.

By State

Table of Contents

What is a Land Contract?

A land contract is a document that establishes the terms and conditions for the purchasing of vacant land for cash or trade. A land contract, similar to a standard purchase and sale agreement, details the agreement between the buyer and seller including any conditions, contingencies, and due diligence periods.

Installment Land Contract

An installment land contract is when a buyer makes payments after the closing to pay the sales price. Also referred to as “owner financing”, it allows a seller to act as the bank and collect principal plus interest payments from the buyer. Even though the buyer will own the property after the closing, the seller will be a lienholder with the rights to repossess the property if payment is not made.

Land Contract Calculators

How a Land Contract Works (5 steps)

This is a simple guide on how to legally purchase land and have recorded in the buyer’s name after the closing.

Step 1 – Make an Offer

In order to make an offer for purchase, the buyer will need to complete the land contract either themselves or with the assistance of a real estate agent or attorney. The buyer will need to enter all the information about the land, which can be obtained from the local assessor’s office, and list any conditions for the sale.

Step 2 – Wait to Hear from the Seller

After the contract has been finalized by the buyer, the seller will need to either reject, counter-offer, or accept the terms of the agreement. If accepted, the buyer will need to pay the earnest money deposit (use earnest money deposit receipt) and begin their due diligence period.

Step 3 – Due Diligence Period

In most agreements, there is a due diligence period that allows the buyer to conduct tests on the property to ensure it can be used for the buyer’s intentions. This may include conducting environmental tests, getting permits from the local government, or any other contingencies listed in the agreement.

Step 4 – Closing on the Property

After the due diligence on the property has concluded and contingencies have been waived, it’s time to prepare for the closing. If the buyer is seeking to pay cash then the closing can occur almost immediately. If the buyer has decided to obtain financing then most lenders will require an environmental report (i.e. phase I) and to have the property appraised by a 3rd party.

After the buyer has completed their necessary steps to obtain funds to purchase, the parties may schedule a closing date.

Step 5 – Recording the Deed

At the closing, the seller will verify the funds have been received and sign over the deed to the property to the buyer. The deed acts as the title to the property proving the buyer’s ownership. It is required for the deed to be filed with the Registry of Deeds in the county where the property is located.

There is usually a tax on property sales and is calculated on what is known as a “mill rate” for each jurisdiction. Unless otherwise agreed upon, this tax is usually split between the buyer and seller.

Common Questions

Does a land contract have to be recorded?

Yes and no. The contract itself does not have to be recorded, although, after the closing has taken place the transfer of ownership must be recorded through a deed.

Is it possible to sell a land contract?

Yes as long as the contract has rights to assign the agreement to someone else.

Is it possible to rent land?

Yes but this is more common in commercial property than residential.

Is there a difference between a residential and commercial land contract?

No, both contracts are the same unless due to local or State laws.

Sample

Download: Adobe PDF, MS Word, OpenDocument

How to Write

Download: Adobe PDF, MS Word, OpenDocument

Step 1 – Download The Land Purchase And Sale Contract PDF Template

The “Adobe PDF” link displayed in this section of the page shall grant immediate access to the template required to set a Land Purchase And Sale Contract in writing. You can preview this file by looking over the sample image, if desired, then selecting the “PDF” button coupled with it to access the downloadable file.

Step 2 – Attach The Sale Contract’s Effective Date 

The calendar date that defines when this paperwork becomes effective as a sales agreement will be used to introduce this contract’s information. Article I at the top of the first page provides a couple of blank lines for this purpose. Find the words “…Made On” then document the calendar month and day this agreement will become active on the first line as well as the corresponding year on the second line.

 

Step 3 – Identify The Land Purchaser Behind This Agreement

The full name of the Land Purchaser must be attached to this role along with the date by delivering his or her full name on the first blank space after the “Buyer” label in “I. Parties.” 

 

Step 4 – Produce The Land Purchaser’s Residential Location

The residential address of the Land Purchaser will be expected across the next two spaces in the “Buyer” statement. Begin with a recording of the building number, street, and suite/apartment number in the Land Purchaser’s residential address on the first empty line following the words “…With A Mailing Address Of” then input the city where this address is found to the next available blank line. These two spaces, when combined, should define the physical location of the Land Purchaser’s residential address. 

 

Step 5 – Verify The Land Purchaser’s State Of Residence

The Land Purchaser’s state is needed to complete this address, thus, report it on the space preceding the language “Who Agrees To Buy” in the “Buyer” section. 

 

Step 6 – Name The Land Seller Entering This Contract

The “Seller” section of the article “I. The Parties” seeks to solidify the identity of the Property Owner selling the concerned land. Report his or her full name on the blank line between the label “Seller” and the parentheses label “Seller.”

 

Step 7 – Furnish The Land Seller’s Residential Address

The Land Seller’s residential address is also required of this paperwork and must be displayed in the “Seller” section of the first article “I. The Parties.” The two available lines after the Land Seller’s name seek this address recorded for display.

 

Step 8 – Document The State Of The Land Seller’s Residence

The full address of the Land Seller necessitates that the state where this Party maintains his or her residence be recorded on the final line of the “Seller” section.

 

Step 9 – Report On The Land Being Sold

The second article to be focused on is “II. Legal Description.” The wording used in the first statement will set the physical size of the land to paper. Locate the empty line following the phrase “…A Total Gross Area” then fill in the number of “Square Feet” or “Acres” making up the land as its content. Once you have recorded this number, indicate if it is being presented as “Square Feet” or “Acres.” The example below will concern a 100-acre piece of land.   Now, that the physical size of the land has been documented proceed to the “Street Address” line to document its physical location.

 

Step 10 – Dispense The Concerned Land’s Parcel Information

The legal “Tax Parcel Information” assigned by the tax assessment office responsible for overseeing the concerned land’s identification is also focused on in  Article “II. Legal Description.” This can be expressed on the blank line “Tax Parcel Information” as a Parcel ID Number or the Tax Map & Lot. This information must be obtained for the Local Tax Office or City Services. 

 

Step 11 – Continue With Additional And Applicable Land Definitions

There may be additional information needed to completely identify the land being sold. For instance, important landmarks, an irregular shape along, and other facts such as County descriptions that are provided with the title or deed description filed with the County Recorder. Any remaining descriptions for this land may be presented on the blank line after “Other Description.”   

 

Step 12 – Place A Value On the Earnest Money

Many property sales will require earnest money submitted to the Seller to offset any losses should the purchase fail. This agreement must name the “Earnest Money” needed to proceed in the third article. The first line after the dollar sign expects the earnest money amount to be documented numerically while the blank line following the words “…As Consideration By” requires the month and calendar day when this money must be received by the Land Seller.

Further define the deadline for the receipt of the earnest money by documenting the time of day when the earnest money must be received on the date recorded earlier in Article “III. Earnest Money.” First, complete the date by dispensing the appropriate calendar year on the line after “20” then furnish the time of day when this earnest money is to be received to the two lines that follow. Once done, mark the “AM” or the “PM” box to complete this report on the earnest money deadline.  

 

Step 13 – Present The Cost Of The Land

Article “IV Purchase Price And Terms” shall cover the amount of the purchase price. The dollar amount the Land Purchaser must deliver to the Land Seller to assume ownership of the concerned property is a mandatory report in this agreement. To this end, locate the blank line that the term “…To Purchase The Property By Payment Of” leads to then furnish the numerical value of the land’s selling price. Additionally, document the selling price by writing it out on the blank line preceding the word “Dollars.”  

 

Step 14 – Indicate If An All Cash Offer Is Being Made

The manner in which the Land Purchaser shall complete this transaction will need to be discussed. This topic occupies the next area requiring review in Article “IV Purchase Price And Terms.” Three checkbox statements, each defining a payment scenario are presented to choose from. The manner in which the Land Purchaser’s payment is to be provided must be chosen from this list. Thus, if the Land Purchase intends to submit an “All Cash Offer,” the first checkbox (bearing this label) should be selected. You can use your mouse to fill it in or manually supply it with an “x” or a checkmark. Naturally, due to the large sums involved, the Land Purchaser will need to produce third party documentation of the payment fund availability when paying full price upfront. The deadline for this verification of funds should be clearly defined by its month, two-digit calendar day, and two-digit year across the first three spaces in the “All Cash Offer” option.  The time of day when third party verification of the Land Purchaser’s funds in an “All Cash Offer” should be dispensed to the two blank lines preceding the checkboxes “AM” and “PM.” After naming the time of day, make sure to mark one of these checkboxes for clarification.  

 

Step 15 – Define Any Bank Financing Involved With The Land Purchase

If the Land Purchaser will be employing “Bank Financing” to obtain the property’s sale amount, then this must be declared along with the type of financing he or she has obtained for this purchase. Begin reporting this information by marking the box labeled “Bank Financing” then continue through this choice, since it will require more attention. If the Land Purchaser has obtained a “Conventional Loan,” this must be indicated by marking the first finance option in the “Bank Financing” statement.   The Land Purchaser may have needed an FHA (Federal Housing Administration) loan. If so, then the checkbox labeled “FHA Loan” must be marked. Be advised that the addendums received must be attached by the Land Purchaser must be attached.  If a “VA Loan” was acquired, then select the “VA Loan” choice and attach the appropriate paperwork. In some cases, the Land Purchaser may have obtained a loan through some other measure. If this is such a case, then select the “Other” option of this list and use the blank line to further define the loan. For instance, in the example below the Land Purchaser and the land being sold qualify for a USDA Subsidized loan. Note: This would require additional paperwork attached as well.

 

Step 16 – Attach A Deadline To Any Required Letter Of Credit

If a loan was obtained, then a letter of credit to verify the Land Purchaser’s ability to pay the costs associated with the obtained loan will likely be required by the Seller. The deadline when the Land Seller must receive this letter (verifying the Purchaser’s credit, income, availability of funds, and the down payment source) is expected as a report you can supply using the two blank lines in item “C.”

 

Step 17 – Discuss The Consequences Of Not Providing A Mandatory Letter Of Credit

Item C continues by requiring some clarification as to the nature of the required letter. That is, if the letter must state that “…Loan Approval Is Contingent On The Lease, Sale, Or Recording Of Another Property” then mark the checkbox labeled “Is.” If, however, the letter must state that this sale “Is Not” contingent on the Land Purchaser’s goals with another property then mark the checkbox labeled “Is Not.”  Section “D” in the “Bank Financing” choice will address the scenario where the Land Purchaser fails to have a Credible Financial Institution verify his credit in writing by the due date mentioned in section “C.” If the Land Seller has determined the purchase should not proceed because this document was unreceived, then he or she may terminate the sale through a written notice issued to the Land Purchaser. The number of days when this notice must be sent after the missed due date of this material must be recorded on the blank line between the phrase “…Notice Provided To Buyer Within” and the word “Days.” 

 

Step 18 – Summarize Any Seller Financing Being Provided

Now, a third option as to how the land sale will proceed can be discussed in Article “IV. Price And Terms.” If the Seller will provide the finance for the land sale, then select the box labeled “Seller-Financing.”  Several details will need to be furnished for the “Seller-Financing” section to fully define the payment. First, produce the exact “Loan Amount” in the blank line of item A in this choice. The second definition needed to define the Land Purchaser’s obtained “Seller Financing” is the “Down Payment” required for this sale. Furnish this dollar amount to the blank line following the words “B.) Down Payment.”  The yearly interest rate the Land Seller expects with the loan payments should be produced on the line placed between “Interest Rate (Per Annum)” and the percent sign in item “C.” Finally, record the “Term” of the loan in item “D” by documenting its number of months or years on the blank line after the word “Term.” This number must be defined further by marking the “Months” box or the “Years” box to indicate the unit that should be used with this number.    Item “E.) Documents” in the “Seller-Financing” section will seek the deadline for the paperwork the Land Seller requires of the Purchaser to proceed with financing. Make use of the first two empty lines in this item to apply this deadline date. Locate the second set of blank lines (after the term “Seller Shall Have Until…”) then furnish the last calendar date when the Land seller will accept the Purchaser’s required credit documentation to their contents.

 

Step 19 – Indicate If The Land Purchaser Must Sell A Separate Property To Proceed

As mentioned earlier, some Land Purchasers may need to sell their own real property so that he or she can proceed with the sale being discussed in this agreement. In Article “V. Sale Of Another Property” this issue must be addressed. If the current land sale is not dependent in any way upon the Land Purchaser’s ability to sell a different real property, then mark the “Shall Not” checkbox in the fifth article.  If this sale can only proceed if the Land Purchaser is able to complete his or her own sale of a property, then mark the “Shall Be” checkbox. This will need some additional information regarding the Land Purchaser’s situation.  If the concerned land sale depends upon the Land Purchaser’s sale of a property, then his or her property should be reported on. Produce the “…Mailing Address Of” the real property the Land Purchaser must sell to proceed with this land sale on the first two blank lines presented in the “Shall Be” option in Article “V. Sale Of Another Property.” This requires, first, the entry of the street address for the property that must be sold and, second, the city of this property’s mailing address.   The second set of blank lines shall finish up the report on the Land Purchaser’s property. Report the state in the property mailing address to complete the definition of the Land Purchaser’s property then, on the line that follows, record how many “Days” after the effective date (named in the first article) the Land Purchaser is afforded to close his or her own property sale. This is important documentation since very few Land Sellers would be able or willing to wait indefinitely for the Land Purchaser to proceed. 

 

Step 20 – Assign The Closing Costs To One Party’s Obligation

There will usually be costs associated with the land sale that must be paid in order for it to complete successfully. For instance, there may be a title search required, recording fees with the local jurisdiction, etc. The decision of whether the Land Seller or Purchaser is to cover these costs when the time comes will be handled in Article “VI. Closing Costs” where one of three check boxes must be selected. Thus, mark the “Buyer” checkbox if the Land Purchaser is to pay the closing costs, select the “Seller” checkbox if the Land Seller must pay the costs of closing, or check the “Both Parties” check box if the Land Purchaser and Seller agree to share the closing costs of this land sale. 

 

Step 21 – Verify The Closing Date And Time

As mentioned earlier, the majority of Land Sellers will wish to close a deal within a reasonable amount of time. Thus, the exact date and time when the sale of this land must be completed or closed should be presented in Article “VIII. Closing.” The two spaces placed after the phrase “…Transaction Shall Be Closed On” have been set to accept the month, two-digit calendar day of the month, and year of the land sale’s closing date furnished for display.  The exact time when this sale must be finalized on the day you reported as the closing deadline should be included with your date entry in “VIII. Closing.” Two blank lines and checkboxes enable a quick entry to be made. Use the two spaces on either side of the colon to dispense the time when closing must occur then select either the “AM” box or “PM” box to adequately define this time.

 

Step 22 – Impose The Necessary Deadlines For A Land Survey To Occur

The ninth article, bearing the label “IX. Survey,” requires a definition of how many “Business Days Prior To The Closing” that the Land Purchaser is given to inform the Land Seller of any survey problems with the land that must be remedied for the sale to continue. Record this number of days on the line following the term “Not Later Than…”  The number of days before the closing when the Land Seller must cure the survey problems with the land should also be documented. The term “…To Remedy Such Defects Within” leads to the blank line where this number of days for the notice to cure or remedy must be entered. 

 

Step 23 – Compose The Due Dates For The Property Inspection(s)

Continue reading through this sales agreement to Article “XI. Title” where some discussion regarding the Purchaser’s review of the title of the Seller’s land must be engaged. If the title for the land being sold presents any defects to that land the Purchaser may determine that such land defects must be repaired or remedied. This requires that the Land Purchaser give notice within a certain time period after receiving the land title. Define this period as a number of days by furnishing it to the blank line preceding the term “Business Days To Notify The Seller, In Writing…” This phrase can be found in the second paragraph of “XI. Title.” The third paragraph in Article “XI. Title” will also need a definition reported to supplement its language for the purpose of this document. Here, the number of days after the Land Seller receives notice that a significant defect on the land must be remedied before the purchase proceeds must be presented on the space presented after “…The Seller Shall Have” and before the wording “Business Days…” 

 

Step 24 – Engage A Dialogue On Require Property Cures And Maintenance 

There will be a time period from the effective date until the closing date where the land will need to be maintained or brought up to the standards of the sale. The Land Purchaser will have the option to perform independent inspections during this time (strongly recommended by many). The time given for this will need to be documented in Article “XII. Property Condition.” To this end, locate the four lines formatted to accommodate a date and time of day then, supply the last calendar date when the Land Purchaser may conduct inspections of the land (for defects or problem) using “…Licensed Contractors, Or Other Qualified Professionals” as well as the time when all inspections generated by the Land Purchaser for this purpose must cease. Once you have reported the date and time, make sure to mark the “AM” or “PM” box to specify what part of the day the reported deadline time refers to.  In a contingency where the Land Purchaser’s inspection(s) results in a land defect that bears discussion then the deadline for the Land Purchaser to notify the Land Seller of this need must be presented. Therefore, seek the phrase “…Buyer Shall Have Until” then distribute the calendar date and time of day representing the deadline when such notification must be received by the Land Seller across the blank lines that follow making sure to indicate if the time of day reported is “AM” or “PM by selecting the appropriately labeled checkbox. The third paragraph in “XII. Property Condition” requires one more piece of information before it can be considered complete. The number of business days allowed to the Land Seller and Land Buyer to reach an agreement after the Seller’s notification that a serious land defect exists should be documented on the space that follows the language “The Buyer And Seller…”   

 

Step 25 – Distribute The Appraisal requirements For This Land Sale

The fourteenth article of this paperwork shall deal with the topic of the land’s “Appraisal.” If the land sale will not depend upon the results of a formal appraisal naming its value to be “…Equal To Or Greater Than” the approved purchase price, then mark the checkbox corresponding to the bold label “Shall Not” in Article “XIV. Appraisal.”  If the land sale depends upon its appraised value being “Equal To Or Greater Than The Agreed Upon Purchase Price…” then select the “Shall” option in Article “XIV. Appraisal.”  Naturally, upon hearing of an appraisal’s results a certain amount of negotiation may be needed. Document the number of days after the appraisal’s report these Parties will have to re-negotiate the land sale if this becomes necessary.

 

Step 26 – Produce The Earnest Money Return Should The Land Purchase Fail

As you may have noticed, this paperwork will provide methods to terminate the sale. If any of these methods are employed, then the earnest money mentioned earlier must be returned within a certain number of (business) days after the termination. Record the number of business days after the sale termination when the Land Purchaser must be in receipt of the earnest money return from the Land Seller on the blank line in Article “XVI. Termination.”   

 

Step 27 – Assign A State’s Law To This Contract

The “Governing Law” that enforces the articles presented in this paperwork must be named after the language “…The Laws In The State Of” found in Article “XXIII. Governing Law.” 

 

Step 28 – Inform The Purchaser Of Applicable Offer Expiration

The Land Purchasers may also have certain time constraints requiring that this paperwork be signed and received from the Seller. Record this time of day and date in Article “XXVII. Offer Expiration” by distributing it across the appropriately formatted spaces provided. This definition also requires that you select “AM” or “PM” to define this deadline accurately.

 

Step 29 – Include All Disclosures As Required By Governing Law

More often than not, property purchases such as a land purchase will need one or more required “Disclosures.” If any disclosures must be made by either Party and attached to this agreement each one must be named in the contents. Article “XXX. Disclosures” handles the topic of attached addendums and disclosures through a presentation of checkbox options. Thus, if no addendums, disclosures, or other such attachments will be included with this document, then mark the first checkbox in this section.  If there will be any addendums or disclosures, then mark the second check box in “XXX. Disclosures.” Be advised, selecting this option will require additional descriptions.  In a case where a “Lead-Based Disclosure Form” is attached, select the checkbox corresponding to the words “Lead-Based Paint…”  Three additional checkboxes are provided adjacent to a respective blank line. Any addendum or disclosure required by this document that is attached before the time of signing must be named on the blank line then the corresponding checkbox selected. 

 

Step 30 – Make Sure All Provisions Applying To The Land Purchase Are included

While this agreement will act according to its content, some “Additional Terms And Conditions” may need to be solidified. If so, then use the optional section in Article “XXXI. Additional Terms And Conditions” to dispense any limitations, restrictions, or benefits applicable to either or both the Land Seller or Purchaser. If no such provisions must be declared and this agreement represents the entire contract then, you may cross out this section or supply the word “None.”   

 

Step 31 – Provide Verification That Each Party Has Read Every Page

Both Parties must be given ample opportunity to review the completed agreement. As proof that this review has taken place, every page of this agreement presents two lines at the bottom of the page. Upon reviewing the completed page the Land Purchaser must initial the blank line “Buyer’s Initials.” Similarly, the Land Seller must also initial the “Seller’s Initial” line at the bottom of every page to prove that he or she has reviewed every completed page. This task must be completed for every page after it has been completed with the information it requests and before these Parties execute this paperwork through the act of signing.

 

Step 32 – All Sellers Of The Concerned Land Must Execute This Agreement

Every Seller, Purchaser, and Agent participating in the land sale being documented above must complete a signature area designated for that Party. This document produces a signature area for two Land Sellers, two Purchasers, and two Agents. If any of these categories require more than two Party signatures then you may copy and paste additional signature areas as needed. At least one Land Seller and one Land Purchaser must enter this agreement to execute it. The first Party to have this opportunity will be the Land Seller. If this paperwork accurately depicts what the Land Seller will agree to then he or she must enter the current “Date” on the first line under the section title “XXXIII. Signature” then sign his or her name on the “Seller’s Signature” line.
In addition to the signature, the Land Seller must print his or her name on the “Print Name” line that follows.

 

Step 33 – The Land Purchaser(s) Must Provide A Signature(s) Of Execution

Once every Land Seller has signed his or her name to execute this paperwork, the Land Purchaser must gain control of the paperwork so that this Party can also review the completed agreement. If the Land Purchaser agrees with the provisions of this sale and will meet the obligations placed, then he or she must locate the “Date” line adjacent to the “Buyer’s Signature” line. Here, the Land Purchaser must provide a dated signature by entering the signature “Date” on the first of these lines and signing the second available line. An additional signature area has been provided should an additional Land Buyer intend to enter this contract. Only Signature Parties signing this document will be considered eligible for its benefits and responsible for its content.  

Every Land Purchaser signing this agreement as a demonstration of his or her intent to adhere to it must print his or her name on the “Print Name” line below the signature line. 

 

Step 34 – Complete This Document With The Participating Agent’s Signature

The final signature area of this paperwork seeks the Agent’s report of the current calendar date as well as his or her signature (on the “Agent’s Signature” line). Two distinct Agent signature areas have been supplied should an additional Agent be involved.    

Every Signature Agent of this land sale must also print his or her name on the “Print Name” presented below his or her signature.