People sometimes use the terms, land contract and land trust interchangeably but theyre not the same thing. A land trust gets set up to protect estate assets, but its revocable. Typically the buyer sets up the trust anonymously and may, at some point, assign the trust to an investor. Alternatively a land trust may be set up by a nonprofit group that utilizes the trust to protect specific tracts of land (Conservation Land Trusts).
By comparison land contracts are used for financing. Here, the seller allows the buyer to pay for a property in installments. During this time the land and house remain in the sellers name. Alternative names for this arrangement include contract for deed or even rent to own.
Both land trust and land contracts offer buyers ways of getting a house or property using owner financing. This is particularly advantageous if the seller already has a low interest rate loan in place thats assumable.
More about Conservation Land Trusts
There are numerous natural areas that receive Trust protections because of the resources they represent be it rare animals or endangered plant species. Once the trust goes into place specific rules govern what can take place there. For example, many trusts forbid mining or drilling. Some of these properties become part of National Park systems over time. This, in turn, allows for some visitors (which also provides an income to the trust).
