Land Contract Sale
For those of you who are not familiar with the term, a land
contract sale is simply a sale of property on payments. In some
places it is also called a contract for deed or contract for
sale. The owner typically takes a down payment from the buyer
and then accepts monthly payments with interest. With a mortgage
loan the buyer has the deed to the property with a lien on it.
With a land contract the actual deed to the property is conveyed
after all payments are made.
With that explanation I introduce the following entry in the
Most Interesting Money Maker Contest. (Other entries are
listed on the page Interesting
Ways to Make Money.) It is not the most unusual way to make
money, but the story is interesting for another reason; it shows
what is possible if you do what you can to get ahead.
Jeri
Arizona
There is nothing very unusual about someone making money
from selling a piece of real estate. It was a trifle unusual
in the circumstances that occurred. A lifelong dream of mine
was to have my own land and to design and build a unique home.
I was also motivated by a friend who was doing exactly that,and
thirteen years later, still is.
I found the land quite by accident, while driving around
on a Saturday afternoon. It felt right and I am a person who
tries to listen to my intuition. I found the owners eight miles
away and at home. They were willing to agree to a land contract,
so we agreed in principle to a deal on the spot. So began a six
year stretch where I lived in resort housing in the winter and
camped on my land during the other seasons; thus saving rent
to apply to my project.
The economy was in the tank and my small remodeling company
was dying a slow death, health problems were mounting and I saw
the project of a home out of pocket as increasingly impossible.
Therefore, I decided to sell my land with a small cabin that
I built.
I paid $7200.00 and put approximately $2000.00 into it
as well as unknown thousands of hours into it. I sold it for
$15000.00 and interest on a land contract - in essence doubling
my money.
If you were reading between the lines you may have realized
that the capital gain and interest on the land contract sale
were only part of the money equation here. The author mentions
that he camped on the land for much of each year instead of paying
rent. Some wouldn't be willing to do this, but it clearly meant
saving many thousands of dollars in rent each year - something
to consider when looking at the financial advantage of this investment.
Note: Sign up for the newsletter (the form should be
to the right), where I'll announce new competitions when I have
them - or just send me any true story you have of an interesting
way you've made money. If I use it here I'll send you an e-book
of you choice (with at least two or three to choose from).
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