Land Contract Attorneys

Michigan Land Contract Lawyers

michigan land contract lawyers Our experienced real estate lawyers at Hirzel Law can help you throughout   the process of developing a land contract in Michigan for the sale of your   property. Land contracts offer an alternative for buyers and sellers of   property where a traditional mortgage is not an option.  Under a land   contract, the seller is referred to as a land contract vendor and the buyer is   referred to as a land contract vendee.

 Hirzel Law can also assist clients when the land contract is breached. In   cases where the land contract vendor is not paid, or not paid in a timely   manner, we can help the seller forfeit the land contract and extinguish any property rights of the purchaser.  Similarly, if a land contract vendor fails to convey title after full payment is made, we help purchasers obtain clear title to the property. 

What is a Land Contract in Michigan?

land contract in Michigan is an agreement between a buyer and a seller that states the buyer is purchasing property but will not receive the legal title until the debt has been satisfied. Land contracts are a form of seller financing and are typically used in real estate transactions, usually residential, when a buyer cannot secure traditional means of financing. Unlike a mortgage, a land contract stipulates that if a buyer does not fulfill his financial obligations in the agreed upon terms of the contract, then the seller regains possession of the property and keeps whatever money the buyer has remitted. Land contracts are legal and binding in Michigan and must be in writing in order to be enforced. Enforcement is governed by Michigan law and falls under the general category of contract law, however, additional remedies of forfeiting the land contract or foreclosing on the property may also be available.

Does a Land Contract Have to be Recorded in Michigan?

A land contract is not legally required to be recorded in Michigan. However, both the buyer and the seller may wish to record the contract to protect their interests in the property.

Make sure the contract has been properly executed before recording it. The land contract in Michigan should be signed in front of a notary public. Make a copy of the land contract for your records and send or deliver the original to the appropriate register of deeds office.

How to Forfeit a Land Contract in Michigan?

Step 1. Should I forfeit the land contract?

In Michigan, in order to forfeit a land contract, the terms of the land contract must specifically allow for that remedy. If the land contract does not allow for forfeiture, you must foreclose or sue for breach of contract. Forfeiture is the preferable remedy for many sellers as it is the fastest and most efficient way to obtain possession of the property. The disadvantage of a land contract forfeiture is that you are not allowed to recover a money judgment for past due payments or accelerate the debt. If you want to pursue these remedies, you should file an action for foreclosure or for breach of contract. Rather, in a land contract forfeiture, the purchaser can pay what is currently due to retain possession. However, you the seller could obtain a money judgment for a reasonable rental rate during the redemption period in a Land Contract Forfeiture action.

Step 2. Provide Notice to the Purchaser.

Prior to commencing a land contract forfeiture, you must provide and serve notice. If the past due payments are not made within fifteen (15) days, you can then file a summons and complaint.

Step 3. File the Summons and Complaint.

If you are not paid within fifteen (15) days of serving the Forfeiture Notice, you can file a Summons and Complaint in the local District Court. The Court should provide you with a court date and then you will need to serve these forms on the purchaser.

Step 4: Summary Proceeding

If the seller does not answer the complaint or appear at the hearing, obtain a default judgment. If the seller does appear, be prepared to present proofs regarding the money owed. Alternatively, the Court may set a trial date and enter a discovery order.

Step 5: Obtain an Order of Eviction.

If the purchaser fails to pay the amount contained in the Judgment, you can obtain an Order of Eviction and have the Court Officer physically remove them from the premises. After the entry of a judgment of possession, the purchaser will have either 90 days or 180 days to redeem the land contract before a judgment of possession can enter. If the purchaser has paid less than 50% of the land contract off, the redemption period if 90 days, if they have paid more than 50% of the land contract off, the redemption period is 180 days.

Speak to a Land Contract Attorney in Michigan

Our land contract lawyers in Michigan can handle all aspects of drawing up your land contract, including the recording of all the proper paperwork with Register of Deeds and the surrounding municipalities, or representing you in the event of a breach of the land contract.

Contact Hirzel Law online or call 248-986-2921 (Farmington) or 231-486-5600 (Traverse City) or 616-319-9964 (Grand Rapids office) to see how our Michigan real estate attorneys can help with land contracts.

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