• Why do people take out an instalment contract?

    Reena MalraAn instalment contract is also referred to as delayed completion or long stop. It’s basically a way of legally buying a property but delaying the time between exchange and completion. You enter into an agreement with the buyer or seller, whereby you commit to buy the property at an agreed timeframe. It’s different to a property lease option whereby you can decide at the end of the term what you want to do with the property – this way you are legally required to complete the sale. It’s essential that you get the right advice before entering into this agreement and are clear on the requirements and conditions of such an agreement. An instalment contract allows you to purchase a property without going through the traditional route and finding a hefty deposit in order to you to either start a property portfolio or buy a home for you and your family.

    [heading style="1"]Why do people take out an instalment contract? [/heading]

    The reason that people delay the completion on a property will differ between properties, buyers and other interested parties. One common reason is that the property is in negative and in instalment option will give the seller and buyer (and everyone else involved!) time to switch to neutral equity, then afterwards positive equity making it a much better deal. Another example is that the seller wants to have their price, and is willing to wait. Another reason is that a property could be pending planning permission or that a submission to make the property a HMO is pending. It’s a way of delaying what you can’t do what you want with it today yet not losing out on selling or buying the property subject to these terms.

    If you think an instalment contract might be right for you, there are many things to consider. This blog just gives a general overview so it’s important to get advice based on your individual circumstances. If you want to look at the possibility of an instalment contract for whatever reason, contact me, Reena Malra, via email at reena@reenamalra.com or give me a call on 0203 397 7030.

    Listen to my full Audio post on instalment contracts.


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    About Reena Malra

    Connect with me: Google+ Reena Malra is one of the UKs most successful property investors and mentors. The strategies Reena has discovered and developed over the past few years take the focus off the price and put it on the flexible and convenient payment terms. This is how Reena can structure transactions to really benefit both the buyer and the seller. Reena specialises in property lease options, instalment contracts, rent torent, below market value (BMV), stopping repossessions, joint venture, delayed completion and tenant buyer strategies. She also runsworkshops and webinars, and offers property consultancy services and one-to-one mentoring.

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    2 Responses to “Why do people take out an instalment contract?”

    1. scott Says:

      Hi Reena,

      Please can you recommend a Solicitor in the North West (or elsewhere in the UK) that understands installment contracts.


      • Reena Malra Says:

        Hi Scott,

        Sure, happy to help! Please give me a call so I understand the structure of your deal before I recommend you a solicitor.



        0203 397 7030


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