The Louisiana Bond For Deed. A Possible Alternative To Mortgage And Foreclosure

A Bond For Deed, more often referred to in other states as a “conditional sale contract”, is the Louisiana process that, if used correctly, may allow someone with credit problems to purchase real estate even when they do not qualify for a mortgage or only qualify for a sub prime mortgage.  It may also allow a debtor risking foreclosure to get necessary financial relief. 

In a Bond For Deed the seller retains title to the property until the buyer has finished paying for it.  After the final payment a separate agreement, known as an act of transfer, transfering the real estate from the seller to the buyer is required.

In order for a debtor to sell a piece of real estate under a bond for deed where a mortgage is present, Louisiana law requires that the mortgage holder sign a written guarantee that it will release the property from the mortgage once the terms of the agreement are completed.

Before entering into a Bond For Deed it is a good idea to speak with a lawyer with experience in these types of transactions to make sure that this is the right thing for you.  These types of contracts can be very one sided in favor of the owner and it is important to go into such an agreement with your eyes open.