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So whether a seller selling a property on a land contract actually triggers due-on-sale provisions is debatable, since the land contract purchaser does not obtain title until they pay off the contract. Therefore, memorandums of a land contract are recorded in the county to put the world on notice of a transaction.

Under an installment contract, the buyer gets possession of the property and makes installment payments of the purchase price over an extended period of time to the seller, who conveys legal title to property once the purchase price is fully paid.

Advantages of Installment Approach Some sellers feel more comfortable retaining title to their property until the purchase price is paid in full, making an installment payment financing arrangement more satisfactory than the seller take back financing alternative.

An installment sale can help keep sellers keep their income within a desired tax bracket by spreading out their income. These sales can also keep capital gains in a lower tax bracket.

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