Selling on Contract

[Thomas M.]

I was approached by a friend to sell a house we're considering flipping to another person on contract. They have a large down payment (about 35% of the home's listing price) that they could pay us up front. This person can't get financing right now, but will likely be able to get a MTG in 2 years. So, we'd basically be the bank until this person can get their own financing. I think this person could also do the upgrades/remodeling.

I know nothing about selling on contract. 

What are the pros?

What are the cons?

Is it flat out a bad idea?

What would we need to put in the contract?

Thanks!

[Corey Woodruff]

don't do a land contract to sell. Sell the property as a lease option. This leases the property while giving the tenant the option to buy it in a certain amount of time usually 1 to 2 years later. If the tenant can not get the loan after that time has passed you have the option to cancel the contract or to extend it using another lease option contract. Doing the lease option is much easier to evict somebody than the land contract because from what I hear using a land contract you must go through the complete foreclosure process to get them out of the house if they choose not to pay