How does Contract for Deed Work?

This is a real-estate term and is just about always used when there is owner financing involved. The seller of the property will retain the deed to a property but the buyer will take possession. The buyer will assume all responsibility of the property other than legally owning it. This is a legal contract and the buyer usually makes payments to the seller until the full purchase price is paid and at that time the buyer will receive full ownership and the deed or title to the property.