When it comes to buying and selling property, there are several ways to finance the transaction. One option is a land contract with a balloon payment. This type of agreement allows the buyer to pay the seller in installments over a specified period of time, with a larger final payment due at the end of the contract. Here is a sample land contract with a balloon payment to help you understand how this type of agreement works.

PARTIES

The parties to this contract are the seller (hereinafter referred to as “Seller”) and the buyer (hereinafter referred to as “Buyer”).

PROPERTY

The property being sold is located at [insert property address] (hereinafter referred to as “Property”).

PURCHASE PRICE

The purchase price for the Property is [insert purchase price] (hereinafter referred to as “Purchase Price”).

PAYMENT TERMS

Buyer agrees to pay the Purchase Price to Seller in accordance with the following payment terms:

1. Down Payment. Buyer shall pay a down payment of [insert down payment amount] (hereinafter referred to as “Down Payment”) to Seller upon execution of this contract.

2. Installment Payments. Buyer shall make installment payments to Seller in the amount of [insert installment payment amount] (hereinafter referred to as “Installment Payment”) on the [insert payment due date] of each month, beginning [insert first payment due date].

3. Balloon Payment. Buyer shall pay a balloon payment of [insert balloon payment amount] (hereinafter referred to as “Balloon Payment”) to Seller on or before [insert balloon payment due date], which is the final payment due under this contract.

4. Interest. Buyer shall pay interest on the unpaid balance of the Purchase Price at the rate of [insert interest rate] per annum, calculated monthly.

5. Late Fees. In the event that Buyer fails to make any payment when due under this contract, Buyer shall pay a late fee of [insert late fee amount] for each payment that is not made on time.

DEFAULT AND REMEDIES

In the event that Buyer fails to perform any obligation under this contract, Seller shall have the following remedies:

1. Acceleration. Seller may accelerate the payment of the entire unpaid balance of the Purchase Price, including any interest and fees due under this contract.

2. Termination. Seller may terminate this contract and declare the Purchase Price immediately due and payable, in addition to any interest and fees due under this contract.

3. Foreclosure. Seller may foreclose on the Property in accordance with applicable law to satisfy the unpaid balance of the Purchase Price, including any interest and fees due under this contract.

GOVERNING LAW

This contract shall be governed by and construed in accordance with the laws of the state of [insert governing law].

CONCLUSION

A land contract with a balloon payment can be a useful tool for both buyers and sellers in a real estate transaction. This type of agreement allows for flexible payment terms and can be a viable alternative to traditional financing options. However, it is important to consult with a real estate attorney before entering into any type of real estate agreement to ensure that your interests are protected.