What type of contract is formed when an owner sells land while retaining title until full payment is made?

When an owner sells land while retaining title until full payment is made, this arrangement is known as a land sales contract. This type of contract allows the buyer to take possession and use the property while making installment payments, but the seller retains legal title to the property until the agreed-upon amount has been fully paid.

The structure of a land sales contract is significant because it offers a level of security for the seller, ensuring that they maintain ownership until they receive full payment, which minimizes the risk of losses in case the buyer defaults on their payments. Moreover, this contract clearly outlines the terms, such as the purchase price, payment schedule, and any conditions relating to property use.

In contrast, a lease agreement does not involve a sale and typically gives the lessee temporary rights to use the property without acquiring ownership. A maintenance contract is unrelated to property transfer and focuses instead on upkeep. A title transfer agreement would imply the actual transfer of legal ownership, which does not apply here since the seller retains the title during payment.