This is commonly referred to as an instalment contract it mirrors a bank loan but has a couple of differences, it is a recognised mortgage regulated by the National Credit Code of Australia depending upon your vendor. Repayments are weekly not monthly in our contracts, you must occupy the property you cannot move out and rent it out to a third party, However you can rent out rooms , in short it has to remain your principle place of residence.

Everything else is similar to a traditional bank loan. You are responsible for rates, water and insurances on the property just like anyone buying a home from a bank is. You can fix the interest rate or leave it variable its your option subject to lender approval. You can sell it , refinance it, renovate ,repaint it whatever you decide. Whatever equity is built up in the property is yours to keep as the purchase price is fixed via a contract and does not change if the market goes up you keep the gain there is no profit sharing you keep anything above your purchase price.

One of the major differences is the Title of the property does not transfer until the contract is completed or one third of the purchase price is paid off whichever comes first. To understand the mechanics of an Instalment contract you need to understand 3 things.

A Vendor Finance Instalment Contract. This is a standard Qld, Contract for the Sale of Land, with three additional features.

1. A 30 year delayed settlement that can be completed any time prior to the end of the term, and
2. An Instalment Payment Schedule that allows the buyer to pay down, or partially pay down, the purchase price before the Contract completes with interest.
3. Permission to move in under licence, while the Contract runs.