Are Funds From a Contract for Deed Exempt from Creditors?
Full Question:
I've been assigned a judgment against a debtor who sold a house CFD (MN). Is the income from that CFD exempt from collecting? Can I try to collect from the person paying the CFD? The debtor lives in Texas, the CFD home is in MN.
07/21/2009 |
Category: Contract for Deed |
State: Minnesota |
#17693
Answer:
A contract for deed, or land contract, is often used as an alternative means of financing the purchase price of property. The buyer does not receive an actual deed until payments are made under the terms of the contract for deed agreement. Until the buyer receives a deed, ownership isn't transferred and the property is subject to being foreclosed on if the mortgagee/owner defaults on the mortgage. The responsibility for payment for the property is a separate issue from the ownership of the property. The funds received by the seller are generally not exempt funds and are subject to collection efforts by debtors of the seller.