Legal Question in Real Estate Law in Michigan

Re: Land Contract Pitfall

Under a true land contract, title to the property remains with the seller, until the land contract is paid in full, at which time the seller provides the buyer with a deed. The land contract itself should state the seller's and buyer's respective responsibilities for the period during which the buyer is paying the purchase price.

The water bill likely will become a lien against the property, and it must be paid. If the usage which generated the bill predated the land contract, then it is the seller's responsibility, unless the buyer has agreed in the land contract to be responsible for prior bills. If it is not paid, and if a lien attaches to the property, then the buyer will take a deed subject to the water lien. The water department can refuse to provide water to the premises for an unpaid bill, even if the land contract buyer is not responsible for the bill.

The land contract might require that the seller give title free and clear of all liens. If so, then the seller likely still would have responsibility for the bill.

The land contract also might contain terms which address the maintainance of the property. The removal of the cars might be covered by that provision.

The land contract should be reviewed by a qualified attorney, so that the buyer can be advised about her rights. The land contract might provide certain remedies. The law provides others, depending upon the particular circumstances. The land contract buyer may commence a lawsuit against the seller, to enforce her rights.

This response is not intended as legal advice. Your rights and obligations will depend upon the particular facts and circumstances affecting this matter. You should consult an attorney in your area to discuss all of the relevant facts and circumstances. No attorney/client relationship is created as a result of this response.