In a contract for deed (land contract) in Montana, who retains legal title to the property until the purchase price is paid in full?
Correct Answer
B) The seller retains legal title until the contract is fully paid
In a Montana contract for deed (also called a land contract or installment sales contract), the seller retains legal title to the property while the buyer takes possession and holds equitable title. The buyer makes installment payments directly to the seller over time. Legal title does not transfer to the buyer until the full purchase price has been paid and the seller delivers a deed. This arrangement gives the seller security because they can reclaim the property more easily if the buyer defaults, compared to a traditional mortgage foreclosure.
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Related Topics & Key Terms
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Key Terms:
Related Concepts
The Statute of Frauds is a legal requirement that certain types of contracts must be in writing and signed to be enforceable. In real estate, all contracts for the sale of land or interests in land must be in writing.
A time is of the essence clause in a contract means that all deadlines and dates specified in the agreement are strictly enforceable, and failure to meet them constitutes a material breach.
An appraisal contingency allows the buyer to cancel or renegotiate the contract if the property's appraised value comes in lower than the agreed-upon purchase price. This contingency protects buyers from overpaying.
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