Bond for Deed allows buyers to make monthly payments while the seller holds title until the balance is paid. Bond for Deed is also known as Contract for Deed or Land Contract in other states.
Our services include preparing and recording contracts, collecting monthly payments, managing tax and insurance escrows, issuing default notices, and handling title transfers upon payment completion.
We also provide detailed reports, IRS 1098 & 1099 statements, and title transfer when the terms are met. It’s a practical way to finance property without a traditional mortgage.
We are a licensed professional third-party administrator escrow agent for Bond for Deed contracts. Escrow Services, Inc. is the industry’s leading escrow agent with experience and expertise required to properly service Bond for Deed contracts, Installment Options, and Private Mortgage Notes.
Check out our brief informational videos on Bond for Deed.
A Bond for Deed is a Louisiana real estate contract in which the purchase price is paid in installments, and title is transferred after the payments are made in full. In other states, a Bond for Deed is called a Contract for Deed or a Land Contract.
We prepare, notarize, and file memoranda in public records to protect both parties.
We collect payments, pay taxes and insurance when due, and maintain escrow reserves.
Detailed payment history, IRS‑1098 & 1099 statements, and default notices are provided to both parties.
We provide detailed third-party account histories and accurate payoff statements to help facilitate refinances, ensuring a smooth transition to pay off the Bond for Deed and take title.
Use a Bond for Deed whenever the Purchaser or the property does not qualify for a loan. Many would-be Purchasers can not qualify for a new mortgage…sometimes the property doesn’t qualify…the reasons are endless. The terms of the Bond for Deed are strictly between the Seller and Purchaser.
Use a Bond for Deed whenever the Seller will finance all or a portion of the sales price. Cancelling a contract for non-payment is much less costly than foreclosure.
Use a Bond for Deed when the Seller requires a material down payment. A Bond for Deed provides benefits and advantages to a Buyer which justify the investment of a material down payment.
Use a Bond for Deed to buy or sell property today and “bridge through” to a future period when mortgage rates or insurance underwriting become more favorable, market values increase, or the property is renovated or improved.
Use a Bond for Deed to save closing costs. When you buy or sell property under the Bond for Deed contract, you do not have to pay ‘points’, appraisal and survey fees, private mortgage insurance (PMI), or for repairs required by a mortgage company before it will make a loan.
Use a Bond for Deed whenever the existing mortgage is not assumable. Anyone can make the payments of an existing mortgage and court decisions have clearly established that permission of the mortgage company is not required, unless the mortgage specifically prohibits Bond for Deed.
We manage Bond for Deed agreements from start to finish. That includes contract drafting and recording, monthly payment collection, escrow reserve management for taxes and insurance, IRS 1098 reporting, default notices, and title transfer coordination.
The Seller earns interest as the “Lender”. Sales price is not dependent on the mortgage holder’s requirements. Property is acquired “as is”, and the Purchaser is typically responsible for paying taxes and insurance. The Seller is not a Landlord.
Neither the Purchaser nor the property has to qualify for a loan. The Purchaser can claim IRS interest deduction, and he or she builds equity through amortization of the Bond for Deed contract and market appreciation. Also, the Purchaser has benefits of home ownership and is not a Tenant.
We manage Bond for Deed agreements from start to finish. That includes contract drafting and recording, monthly payment collection, escrow reserve management for taxes and insurance, IRS 1098 & 1099 reporting, default notices, and title transfer coordination.
The Bond for Deed contract is recorded in both the Conveyance and Mortgage records in the Parish’s Clerk of Court’s office to protect the rights of both parties.
The Purchaser is responsible for repairs, maintenance, insurance, etc., after the closing of the Bond for Deed contract.
Property insurance should be carried in the owner’s name with the Purchasers listed as Additional Insurers. Title insurance is also available to ensure the validity of the title that is to be conveyed to the Purchaser.
The IRS treats a Bond for Deed the same as an installment sale for tax purposes.
Our contract includes a Power of Attorney empowering Escrow Services, Inc. to transfer ownership of the property to the Purchaser upon full payment or refinancing.
In the event the Seller files a bankruptcy action, the Purchaser is protected by the Bankruptcy Code.
The death of a Seller or Purchaser does not affect the validity of a Bond for Deed. As a “Heritable” contract under Louisiana Civil Code, the heirs inherit the benefits and the obligations of the Bond for Deed.
Mortgages to Buyers under a Bond for Deed qualify as refinances by mortgage lenders rather than new purchase loans. Payments to Escrow Services, Inc. are viewed as mortgage payments paid to an independent third party by mortgage loan underwriters.
A Bond for Deed is a unique Louisiana real estate contract where the buyer pays the purchase price in installments. Unlike a traditional sale, the seller retains legal title until the final payment is made, at which point the title is formally transferred to the buyer. It is often referred to in other states as a “Land Contract” or “Contract for Deed.”
In a traditional Credit Sale (Owner Financing), the title transfers to the buyer immediately at closing, and the seller holds a mortgage. In a Bond for Deed, the seller keeps the title as security until the contract is paid in full. This provides a streamlined path to homeownership for Louisiana residents who may not currently qualify for a bank mortgage.
Under Louisiana Revised Statute 9:2943, if a property is burdened by a mortgage, all payments must be made to a bank or a licensed escrow agent. Escrow Services Inc. acts as this neutral third party, ensuring that the buyer’s monthly payments are properly distributed to the underlying mortgage holder and the seller, protecting both parties’ interests.
Yes. Because Bond for Deed is an agreement directly between a buyer and seller, traditional bank credit score requirements typically do not apply. This makes it an excellent option for Louisiana buyers with past credit challenges, medical debt, or those who are self-employed and cannot provide traditional income documentation.
Yes. According to Louisiana law, a buyer in a Bond for Deed contract is typically eligible for the Homestead Exemption, provided they occupy the property as their primary residence. This can significantly reduce the annual property tax burden for the buyer.
If a buyer fails to make payments, Louisiana law provides a specific “cure period.” The seller (via the escrow agent) must serve a 45-day notice by registered or certified mail. If the buyer does not catch up on payments within those 45 days, the Bond for Deed can be canceled, and the seller regains possession of the property more quickly than through a traditional foreclosure.
Absolutely. A Bond for Deed is frequently used on properties with existing “Due on Sale” mortgages. However, Louisiana law requires a written guarantee from the mortgage holder to release the property upon full payment. A professional escrow company is essential here to manage the distribution of funds correctly.
Typically, the buyer is responsible for taxes, insurance, and maintenance, just as a traditional homeowner would be. These funds are often “escrowed” or collected monthly by Escrow Services Inc. to ensure they are paid on time, preventing any tax liens or insurance lapses.
Once the final installment or “balloon payment” is made, the seller is legally obligated to execute a deed transferring ownership to the buyer. At Escrow Services Inc., we track the payment history and assist in the coordination of the final title transfer to ensure the process is seamless and legally sound.
Unlike a bank loan, an appraisal is not legally required for a Bond for Deed in Louisiana. However, it is highly recommended. Buyers and sellers are free to negotiate their own terms regarding the property’s condition, usually selling the home “As-Is.”
Most Bond for Deed contracts allow for early payoff without penalty, though this depends on the specific terms negotiated between the buyer and seller. Early payoff is common when a buyer’s credit improves enough to refinance into a traditional lower-interest mortgage.
Escrow Services Inc. provides professional Bond for Deed servicing throughout the entire state of Louisiana, including New Orleans, Baton Rouge, Shreveport, and Metairie. Our expertise ensures your transaction complies with all Louisiana Revised Statutes.
