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This disclosure form is used by an agent when preparing an offer or counteroffer to buy, sell, exchange or option a one-to-four unit residential property with the seller extending credit on a land sales contract, to prepare an addendum to disclose the terms and conditions of the land sales contract. 


Your use of RPI Form 300-1

Carryback financing

Seller financing, also known as carryback financing, occurs when a seller carries back a note and trust deed executed by the buyer to evidence a debt owed for purchase of the seller’s property. [See RPI e-book Creating Carryback Financing]

A seller who offers a convenient and flexible financing package to prospective buyers makes their property aggressively more marketable and defers the tax bite on their profits.

For buyers, seller carryback financing offers:

  • a moderate down payment;
  • competitive interest rates;
  • less stringent terms for qualification than those imposed by lenders; and
  • no origination costs.

Seller financing is documented in a variety of ways, including:

  • land sales contracts;
  • lease-option sales;
  • sale-leasebacks; and
  • trust deed notes.

A carryback seller assumes the role of a lender at the close of the sales escrow. This includes all the risks and obligations of a lender holding a secured position in real estate.

The secured property described in the trust deed serves as collateral for the debt. The property itself is the seller’s sole source of recovery to mitigate the risk of loss on a default by the buyer.

Land sales contracts

land sales contract is an agreement used by a carryback seller to retain title to the property until all or an agreed part of the purchase price has been paid.

land sales contract is also commonly called a:

  • land-contract;
  • conditional sales contract;
  • installment sales contract;
  • real property sales contract; and
  • contract for deed.

At its core, a land sales contract is a security device which is different in purpose from a trust deed lien on property. The contract is evidence of the buyer’s debt owed to the seller for the unpaid amount of the purchase price. It states the conditions allowing the seller to retain title to the property.

Under a land sales contract, a buyer and seller enter into a contract for the sale of property. The buyer takes possession of the property and makes payments according to the terms of the contract. The transaction typically lacks a formal escrow, title insurance and full disclosures of property conditions.

When the buyer defaults on a land sales contract, the seller forecloses by holding a sale of the property, even though the property remained vested in the seller’s name. Foreclosure is mandated since the seller needs to terminate the buyer’s right of redemption as the only method for eliminating the buyer’s right to pay off the land sales contract and obtain clear title – unless they enter into a deed-in-lieu of foreclosure. [See RPI e-book Creating Carryback Financing Chapter 22]

An agent uses the Financial Disclosure Statement for Entering into a Land Sales Contract form published by RPI to provide acknowledgement by both the seller and the buyer of the disclosures when the seller extends credit by the buyer executing a debt obligation to pay for part of the sales price of property containing one-to-four residential units on a land sales contract. [See RPI Form 300-1]

Revision history

Form navigation page published 09-2021.

Form last revised 2011.