[turbo6bar]

PoP, you're talking about two different methods. One is buying via land contract (AKA installment sale). You have equitable title here, so you do have some position. He can't evict you. If you don't pay the 'mortgage,' he has to foreclose. You are basically signing a contract wherein the seller is the bank and you get the deed at the end of X payments. The term, interest rate, and closing costs are ALL negotiable. As mentioned before, installment sales can present tax advantages to the seller. On the other hand, the buyer gets to deduct the interest. A saavy seller may structure the land contract with favorable terms and interest such that the note can be resold on the private market. The seller gets a lump sum, and buyer of the note gets an income stream.

The other method you mention is a lease-option, rent-to-own, etc. This is basically renting, but you have the option to buy the home at the end of the option period. Generally, the seller and buyer/renter negotiate an option fee and the sales price. If the buyer does not exercise the option, the option fee is forfeited. In most cases, the buyer is responsible for securing financing. Lease-options were popular about 6-8 years ago, before the stupid lending became famous. A person with less-then-stellar credit would do the lease-option, have 1-3 years to straighten out credit, and then buy the home. Some lenders were very lenient, allowing a buyer/renter to "refinance" their lease-option. It was great if the house would appraise for more than purchase price.

Sorry for the rambling.

There is no perfect way to buy/sell. It all depends on the property, buyer, seller, and their goals.