Drafting a Contract for Deed in Florida the Easy Way!
Having difficulty getting a loan to buy a house? Searching for an alternative way to finance your real estate purchase because you have an insufficient credit rating? We have got you covered!
In this detailed guide, will explain everything you need to know about a contract for deed in Florida, teach you how to write a contract, and get the best out of legal documents!
What Is a Contract for Deed?
A contract for deed allows a buyer to buy a property by paying directly to the owner in installments. It is also known as a real property installment sales contract or a land sale contract.
This contract relies on seller financing, which is quite popular in Florida. The terms of the agreement determine the down payment, interest rates, monthly installments, average duration of the contract, and balloon payment, among other things.
Once both parties sign the contract, the buyer can use the property to carry out repairs and maintenance. The legal ownership title remains with the property owner until the last payment. When all terms and conditions are met, the property title and ownership are transferred to the buyer.
How Does a Contract for Deed in Florida Work?
Here’s how a contract for deed works in Florida:
- The buyer shows interest in the property and meets the seller to negotiate the terms
- Both parties must sign the document once they agree on the purchase conditions
- The down payment and balloon payment is approximately 20% of the asking price, while the interest rate can be 1–3% higher than the market rate
- Monthly installments are paid until the contract duration is complete
- The last installment is usually a balloon payment, and the buyer must pay the remaining amount in one go. Since the sum is huge, it is usually financed through another loan
- The seller will transfer the property title to the buyer immediately after the balloon payment is covered
What To Consider When Opting for a Contract for Deed
There are numerous pros and cons to consider before opting for a contract for deed.
Check out the benefits and potential risks for the seller in the table below:
|You have a wider range of buyers available||If the buyer defaults, you might have to file a lawsuit, which can be costly|
|The property is in your name until the final installment has been paid||The buyer might cause damage to the property and then default|
|Tax savings when selling the property in installments||You might have to wait for years to transfer the ownership|
The buyer should consider the following factors before signing a contract for deed:
|You can still get a property if you have an insufficient or poor credit rating or don’t have other financing options||One missed payment can cause you to lose not only the property but all your payments up to that point|
|It is a cheaper alternative to a loan||You can’t claim the property until you’ve paid the entire amount|
|The terms of the contract are negotiable||The payment plan depends mostly on the seller|
How To Draw Up a Contract for Deed in Florida Yourself
If you want to create a contract for deed in Florida, here are the essential sections you should add:
- Names, contact information, and addresses of both parties
- Description of the property
- Price of the property
- Down payment, installment amounts, and a balloon payment
- Interest rate
- The average duration of the contract
- Liabilities and warranties
DoNotPay Can Create Legal Documents for You
Creating a contract in Florida might require you to hire a lawyer. Although lawyers can easily draft legal documents, they are also quite expensive.
Another alternative is to look for contract templates online. While they are a cheaper option, they usually don’t fulfill your requirements to a tee.
What option can get you the best of both worlds? It’s DoNotPay! We can create legal documents for you in no time!
All you have to do is follow these quick instructions:
- Type the name of the document you want to create
- Answer our chatbot’s questions to customize your agreement
And that’s it! DoNotPay will send you the final document to download and print.
Check out our list of available customizable templates below:
- Property documents
- Lease agreement
- Real estate purchase agreement
- Estoppel certificate
- Quitclaim deed
- Intent to purchase real estate
- Business documents
- Bill of sale
- Independent contractor agreement
- Operating agreement
- Non-disclosure agreement
- Non-compete agreement
- General business contract
- Personal documents
- Custody agreement
- Prenuptial agreement
- General affidavit
- Promissory note
Can’t find the document you’re looking for? We’re working hard to expand the list, so stay tuned!
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