Information on Land Contracts in Ohio
Owning property gives you a sense of pride and stability. You may finance the property through traditional means, such as through a bank or finance company or set up a private payment plan between you and the seller. The payment plan is considered a land contract and must adhere to certain stipulations in the state of Ohio. The information on land contracts in Ohio is very clear in the Ohio revised code.
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Information Criteria
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Certain information must be included when writing a land contract agreement in Ohio. The contract must clearly state where the property is located, the parties involved in the contract and the selling price, along with the interest rate. You must also include payment due dates, the duration of the land contract agreement and the amount of the down-payment, if applicable. The agreement must also state who is responsible for the taxes and insurance on the property and if any encumbrances exist.
Timeline
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The duration of the land contract is generally shorter than a conventional mortgage. A seller may use a land contract to sell a property which may not qualify for conventional financing. A buyer with little or no down-payment may use a land contract to purchase a property. The land contract time line gives the buyer or seller time to build up a larger down payment or prepare the property to qualify for conventional financing. The buyer and seller determine the length of the contract, generally from one to three years. However, if both parties are in agreement, the land contract may last longer.
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Registration
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Every land contract must be registered in the court house where the property is located. This protects the buyer and seller if there is a breech of contract from either party. Registration also notifies the tax office of the impending sale so the county knows who is responsible for the property taxes. In Ohio, you must register the land contract within 20 days of both parties signing and a copy delivered to the county auditors office.
Default
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When the seller defaults on the land contract, the buyer has the right to take the seller to court to resolve the issue. Both parties must comply with the court's ruling in the case. If the buyer defaults, he may be entitled to the interest paid on the property during the time of the contract. The law in Ohio states the interest is forfeited after 30 days from default, if the buyer is behind in his payments. To claim the interest, the buyer must bring all payments and any fees current before the 30 days expires. If the land contract has lasted more than five years, the seller must enact foreclosure proceedings to take back the property.
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References
- Photo Credit Sold Home For Sale Sign on Burst image by Andy Dean from Fotolia.com
