What defines a contract for deed?

A contract for deed, also known as a land contract or installment sale agreement, is primarily a financial instrument wherein the vendor (seller) agrees to convey the title of property to the purchaser (buyer) upon fulfillment of agreed-upon payment terms. This arrangement involves a promise to repay the purchase price over a specific period, with the property itself serving as collateral until the payment obligations are fully met.

In this context, what makes the answer particularly fitting is its emphasis on both the promise to repay the purchase price and the security interest that the property provides to the seller during the payment period. Unlike traditional forms of financing, the buyer does not receive full title to the property until the entire purchase price has been paid, thus aligning closely with the characteristics of a financial instrument.

The other options describe concepts that do not encompass the full nature of a contract for deed. A warranty for property quality refers to assurances related to the condition of the property, a fixed-price sales document does not specifically address terms of payment over time or any security aspect, and a rental agreement with an option to purchase implies a lease structure rather than a purchase contract. Therefore, the correct answer accurately captures the essence of a contract for deed as a financial instrument that encapsulates both a promise to