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When one buys land or real estate, the buyer usually pays a down payment, and the remainder of the balance at settlement. However, sometimes the buyer does not have enough money for a down payment, or cannot obtain a loan for the due balance. Despite these problems, the seller may still wish to sell his real property to such a buyer. This is typically accomplished through an installment sale agreement or a combination of lease and agreement of sale. There are too many variations in the terms of these agreements to discuss here, so only the basics will be considered.

Often, no down payment is required, with the exception of the advance of one month’s payment. Thereafter, the buyer makes monthly payments according to the terms of the actual agreement. So long as the buyer makes his payments, and otherwise complies with the terms of the agreement, said buyer should receive title to the property once all payments are made.

However, if the buyer defaults, fails to make a payment for example, many agreements allow the seller to deem the payments “rent” and the agreement a lease. As such, the seller will often then proceed to evict the buyer under the theory that the buyer, now a tenant, has failed to pay rent. This is perfectly legal. In other words, when a buyer defaults - fails to pay a due installment or otherwise breaches another condition of the sales agreement - the seller will now exercise his right to deem the agreement a lease and proceed against the buyer under standard landlord and tenant law. He will evict the buyer and keep all the moneys previously paid. He may even be able to sue for moneys not yet paid.

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