Land Contract Monthly Payment Limit
Question: Is there a limit to the amount of the monthly payment for note on a house purchased on a land contract? If so what is the limit?
Answer: The payment on a Land Contract usually depends on three factors: 1. the balance financed; 2. the interest rate; and 3. the amortization term. With this information a person familiar with real estate lending can calculate the equal monthly payment that will pay off a land contract by a certain date. Land Contract interest rates in Michigan are generally limited to 11%. Parties to a Land Contract may arbitrarily agree to a higher payment or to a balloon payment (making the balance due on a certain date). I hope this answers your question. If you want me to work out a payment for you just provide the 1, 2 & 3 information described above.
Attorney: Mark Miller