In an installment contract, who typically holds title to the property until the purchase price is fully paid?

• A. Buyer Holds Title
• B. State Holds Title
• C. Trustee Holds Title
• D. Seller Retains Title

Answer: (D)

In an installment contract, the seller is the legal owner of the property while the buyer makes payments. The buyer takes possession and has equitable title, meaning they can use and benefit from the property, but the formal ownership remains with the seller as security for the unpaid balance. When the final payment is made, the seller transfers full legal title to the buyer via a deed, completing the sale. This setup protects the seller if the buyer defaults, since the contract can be forfeited and possession reclaimed. The state doesn’t hold title in a typical private installment contract, and a trustee would only hold title if there were a trust arrangement; the buyer does not have legal title until all payments are finished.