Contracts
What is a 'land installment contract' (contract for deed) and how might it be used in Hawaii?
AA. A contract for purchasing land for agricultural use only
BB. A seller-financing arrangement where the buyer takes possession but the seller retains legal title until the purchase price is fully paid in installments✓ Correct
CC. A lease that converts to ownership after a specified period
DD. A government contract for developing public lands
Explanation
A land contract (contract for deed, installment sale contract) is a seller-financing method where the buyer takes possession and makes payments over time, but the seller retains legal title until the full price is paid. In Hawaii, this creates risks for buyers (they may lose all payments if they default before the deed transfers), and buyers should be cautious.
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