Five short answers to the questions every buyer and seller asks before signing a Michigan land contract.
A land contract — also called a Contract for Deed — is a written agreement where the seller acts as the bank. The buyer makes a down payment plus monthly installments. Legal title transfers when the contract is paid in full; equitable title is the buyer's from day one. Most states recognize the structure under their own statute (Michigan: MCL Chapter 600; other states have parallel land contract or executory contract statutes).
Conventional lenders rarely finance vacant land or non-conforming parcels. Owner financing fills that gap — it gets motivated buyers and motivated sellers to a closed deal without bank gatekeeping or PMI.
A properly drafted contract spells out principal, interest rate, payment schedule, taxes, insurance, default cure period, and remedies. The memorandum of land contract is recorded with the county so the buyer's interest shows in the chain of title.
Default and forfeiture provisions written under the parcel state's relevant statute. If the buyer stops paying, the seller has clear, statutory paths to remedy — including forfeiture and judicial foreclosure where appropriate. The specific procedure depends on the state.
Rent-to-own keeps the buyer as a tenant until the option is exercised. A land contract makes the buyer a vested equitable owner immediately — with all the rights, responsibilities, and remedies that implies.
Educational content only. Every deal is fact-specific — talk to a licensed agent and an attorney before signing anything.