ContractsInstallment_contracts_and_land_contractsMEDIUM
A farmer agrees to sell a $200,000 rural parcel to a neighbor who cannot qualify for a bank loan. They sign an agreement under which the buyer makes structured monthly payments of $2,000 over ten years at six percent interest, takes possession to farm the land immediately, and receives the formal deed only after the final scheduled payment is satisfied. The agreement walks the buyer through a fixed amortization schedule rather than a single lump-sum closing. Which name best classifies this kind of agreement?
Correct Answer
C) Installment contract
The contract structures payment of the purchase price across a fixed schedule and ties deed delivery to completion of those scheduled payments. That structure — periodic payments with deferred title delivery — is the installment contract.
Answer Options
A
Seller financingB
Equitable interestC
Installment contractD
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Related Topics & Key Terms
Key Terms:
periodic paymentsamortization scheduledeferred deedten-year termscheduled payoff
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