Legal Question in Real Estate Law in Tennessee

The answer will really depend on the terms of your contract. If the land contract fails to include a requirement that no additional mortgages can be granted by the seller then they would be entitled to take out a mortgage. They are usually obligated to deliver a deed to you when you finish paying for it. You may want to go to the sellers and try to get the intention clarified. If they taken out a loan on the property for more than you are paying for the property that may be a sign of a problem. Hope this helps.