I hope this helps Sincerely Leah Augusta, GA
A: I would ask your sister exactly what she means by on contract. Under Contract in real estate means that the property is pending a sale, but I have no idea what exactly she is referring to.
A: on contract seems ambiguous. Your sister probably wants the sale to be written down plus to be legal and binding. There may also be some tax benefits to gain since the transfer may happen within family. She may want to protect her rights and your daughter should want to protect hers as well.
The best way to do this is to seek professional advice on the sales and tax matters.
A: This typically means to sell on a Land Contract or Seller financing. If she sells this way she will accept a purchase price with a certain amount of money down, and a specified interest rate and the term of the contract. Example: Purchase price $200,000 with 10% down amortized over 30 years at 6% interest. What this means is the home is bought for the $200,000 with $20,000 down payment and balance of $180,000 is financed for $180,000 at 6% over 30 years. The buyer will still have to pay for insurance and property taxes. I do warn you to have your sister to check with the lender she has the loan with on that home typically there is a due on sales clause that does not allow her to sell on a land contract unless she does not owe anyone for the home she is selling.
I hope this helps, and it would be in your best interest to have your attorney look over the contract.
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