What is the purpose of a 'Bond for Deed' agreement?

A 'Bond for Deed' agreement serves the purpose of enabling installment purchase of real estate. This arrangement allows the buyer to make payments over time while they gain equitable title to the property, although the seller retains legal title until the full purchase price is paid. This method can make it easier for buyers who may not qualify for traditional mortgage financing to acquire a home.

The installment nature of this agreement benefits both parties, as the seller is assured that the buyer is motivated to fulfill their payment obligations, and the buyer is given the opportunity to occupy and use the property while paying for it. This structure creates a unique transaction that can provide flexibility and alternative financing solutions for buyers looking to purchase a home.