Contract for deed investing works like this: buy a house in a low-price Midwest or Southeast market for around $30,000, do little or no rehab, and sell it on a land contract to a buyer who pays $800 to $1,100 a month and takes over the repairs. On paper that is roughly $750 a month net per house after all expenses. In practice, if you funded the purchase with a five-year private money note, your actual take is closer to $100 a month per house until that note is retired.
That gap between the headline number and the near-term number is the whole story, and it is what most people describing this model leave out. Jenni Vega runs about 25 of these contracts with roughly 30 properties closing by October, and she is candid about it: the land contract income “isn’t going to be income for five years.”
What follows is the actual mechanics — acquisition price, buyer payment, funding structure, the deal flow that feeds it, and the two administrative failures that cost real money.
Key takeaways
- A $30,000 house sold on land contract nets roughly $750/month after expenses — but only after the private money note is paid off. With a five-year loan, current net is closer to $100/month per house.
- Banks generally will not lend on $30,000 houses, so private capital is the binding constraint. In Vega’s 1,500-investor group, inability to raise private money is the single most common reason people stall.
- Term buyers are found on Facebook Marketplace, typically within a few weeks, and pay $800–$1,100 monthly. They become owners on contract and handle their own repairs.
- Payment tracking is a real loss vector: ‘payment processing’ notifications are not completed payments. One buyer went unpaid from August to March before it was caught, and the money was never recovered.
- Build the acquisition pipeline separately. Vega runs a small wholesale operation on roughly $2,000/month in marketing that feeds her land contract buys, closing about four deals a month against a target of five to eight.
From the Real Estate Pros Show
This article draws on an interview with Jenni Vega of Fast Lane Home Buying on the Real Estate Pros Show, hosted by Scott Bursey.
How the Contract for Deed Model Actually Works
The sequence is short and repeatable. Acquire a house for around $30,000 in a market most investors ignore. Skip rehab, or spend a few hundred dollars on something small. Then find a buyer on Facebook Marketplace — usually within a few weeks — and sell the house on contract for deed at $800 to $1,100 a month.
Prices go lower than $30,000. Vega describes closing on a house at $5,700 that was livable but cosmetically rough and needed about $5,000 of immediate repairs. That one is an exception, not the pattern. Most of these properties transfer with essentially no work done.
The person on the other side of the contract is not a tenant. Vega calls them a term buyer — a cross between renting and owning. They move in, the house is theirs, and they make their own repairs.
The buyer profile is specific. These are houses in somewhat rough areas, sold to people who can document income but cannot get conventional financing. In Vega’s framing, the model gives someone a path to homeownership they would not otherwise have, provided they can show they can pay.
That repair transfer is the structural difference between this and rentals. On a short-term rental, the owner eats every repair, every appliance, every roof. On a land contract, the term buyer owns those problems from day one. It is the reason the model can support $30,000 assets without an operations team behind each door.
Deal sourcing comes from three places: on-market listings, wholesalers, and self-generated off-market leads. Vega buys through all three, which matters because volume in this model is entirely a function of how many $30,000 houses you can find.
The Real Cash Flow Math and the Five-Year Clock
Roughly $750 per house per month net, after all expenses. That is the number the model is sold on, and Vega confirms it. But it is the number after the debt is gone.
She uses five-year loans on these houses. Until those notes are retired, her actual monthly net is around $100 per house at most. With 25 contracts, that is the difference between about $2,500 a month today and roughly $18,750 a month once the clock runs out.
This changes how you should plan around a land contract portfolio. Vega started a year and a half ago, which means her earliest houses are three and a half years from full cash flow. When asked about revenue from the business, her answer was direct: it is not going to be income for five years. She thinks of her wholesale company, her Cutco business, her magazine, and her Airbnb management company as the businesses that pay her now.
That framing is worth borrowing. If you are building this portfolio, you need separate income covering your living expenses during the debt-service window. The land contract book is a five-year deferred asset with a step function at the end, not a replacement paycheck.
The contrast with her short-term rentals is instructive. Her best short-term rental grosses about $90,000 a year; smaller ones run $30,000 to $40,000. Net typically lands near half of gross. That income is available immediately — but the owner absorbs every repair, and Airbnb now charges a 15.5% guest fee that squeezes the model further.
Land contracts give you a lower, slower, more predictable number with the repair liability pushed onto the buyer. Short-term rentals give you cash now and a permanent operations burden.
I don’t really look at that as income — that’s not going to be income for five years. It’s maybe $100 a month per house at the very most right now, and when my loans are paid off, all of that money will go to me.
— Jenni Vega, Fast Lane Home Buying
Why Private Money Is the Binding Constraint
Banks do not lend on $30,000 houses. That single fact determines the entire funding structure of this model — every one of Vega’s acquisitions runs on private money, and she is blunt that if you can raise it, you are off to the races, and if you cannot, you do not have a business.
She points to her training group of about 1,500 investors as evidence. The most common reason people in that group stall is not deal flow, not market selection, not screening. It is the inability to raise private capital.
Her own edge is network, built over years rather than months. She lives in Phoenix and works in the real estate industry without being an agent — selling Cutco closing gifts to realtors for decades, and publishing a Real Producers magazine in Arizona. Both businesses put her in front of the same people continuously. When you know a lot of people in real estate, she says, you naturally meet people who raise their hand and say they want to be a private money lender.
The lender preference matters for how you pitch. Vega’s financial partners specifically want to be the note holder, not the operator. They earn double-digit returns and never have to track payments, fill houses, or decide whether to evict someone. She is clear that the operating side is risky — which is precisely why capital gravitates to the passive position.
If you are trying to fund these deals, that is the offer: a secured note on a cheap house at a double-digit return, with no landlord duties. The person who wants operational control is not your lender.
Feeding the Pipeline: The Wholesale Arm and Buy Box Discipline
About a year into the land contract business, Vega started a wholesaling operation on the side — a couple of hours a week at first — and quickly saw that it fed her acquisitions directly. She has since brought on a partner, Meghan, to run it full time.
The operation is deliberately simple:
- Channels: direct mail, cold calling, Facebook Marketplace, and realtor relationships
- Marketing spend: roughly $2,000 a month before paying her partner
- Systems: a CRM with scripts for determining motivation and running comps
- Output: about four deals a month against a target of five to eight
The typical seller is a tired landlord — someone with a bad tenant or who is simply finished with the property. In these lower-income markets there is little competition for that seller, so motivation tends to be high and conversations are short.
Deals either get kept for the land contract book or sold to other investors in her group. That dual exit is what makes the wholesale arm worth running: every lead has two possible homes.
The buy box tightened considerably in year two. Early on, Vega admits she overpaid chasing portfolio milestones — five houses, then ten, then the next benchmark. She was not picky enough and spent too much.
The current standard is binary: buy very deep, or buy something genuinely turnkey. Anything in between gets passed. She walks away regularly over property condition and area quality, and the $5,700 house only cleared the filter because the price was low enough to absorb the condition.
The Two Failure Points: Payment Tracking and Buyer Screening
The first failure is administrative and it cost Vega real money. Her property management payment software sent an email each month saying a payment was processing. She logged each of those on a Google Sheet as a payment received. Processing does not mean completed.
One term buyer stopped paying in August. It was not caught until March, when her new assistant called and told her to sit down. Seven months. The money was never recovered, and the account ended in eviction.
The fix is unglamorous and permanent: an assistant who audits every single payment every single month against the bank, not against a notification email. Vega describes herself as someone who wants to go and go and go rather than sit with spreadsheets, and she solved it by hiring the opposite temperament — an assistant who told her, “I love spreadsheets.”
The second failure point is screening, and it is the thing she names as keeping her up at night. These are lower-income buyers. Some pay late. Some pay very late. Each one forces a judgment call on when to move to eviction, and if a buyer decides to walk, there is damage risk on the way out.
She is direct that a better screening process is needed rather than claiming she has solved it. For anyone entering this model, that is the honest read: the acquisition side is easy and repeatable, the buyer qualification side is where the losses live, and income documentation alone is a thin filter.
Both failures share a root cause. A land contract portfolio is operationally simple and administratively unforgiving.
Where the Model Goes Next and Who It Fits
Vega’s stated direction is up-market and deeper. The plan is to buy more off-market and at better prices, then move into $50,000 to $100,000 houses, add lease options as an adjacent structure, and grow at roughly 10 houses a year — 35 in twelve months, potentially 55 in three years.
The end state is to stop operating altogether and become the private money lender. She has watched her own lenders earn double-digit returns without tracking a single payment, and that is where she wants to land.
Whether this model fits you comes down to two honest questions.
- Can you raise capital? No private money, no deals. There is no workaround at the $30,000 price point.
- Will you actually reconcile the books? Not intend to — actually do it, or pay someone whose job is nothing else.
What this model does not reward is deal creativity. Vega describes the business as simple, repeatable, and with not many problems to solve. Her wholesale partner learned to run the operation in about two months. If you left for 30 days, not much would break.
The last point is hers and it is worth taking seriously. At a conference she heard that the people who succeed at the highest level have the most certitude. In her training program, the people who stall are the ones who pick the model apart and doubt it. She came in deciding it worked and started executing.
Her one regret is timing. She read the book on this model in 2023 and sat on it for a year before starting. With a five-year clock on every house, that delay cost her a full year of the payoff.
Frequently asked questions
How much cash flow does a house sold on contract for deed actually produce?
Roughly $750 per month net after all expenses on a house bought around $30,000, based on Jenni Vega’s 25-contract portfolio. The term buyer pays between $800 and $1,100 per month, and the buyer — not the investor — covers repairs.
That $750 figure assumes the property is free and clear. If you funded the purchase with a five-year private money note, expect closer to $100 per house per month until that note is retired.
Where do you find buyers for a land contract house?
Facebook Marketplace is the primary channel. Vega lists the house and typically places a term buyer within a few weeks of acquiring the property.
The buyer profile is someone who can document income but cannot qualify for conventional financing. They take ownership under the contract, handle their own repairs, and are best thought of as a cross between a tenant and a homeowner.
Can you finance a $30,000 house with a bank, or do you need private money?
You need private money or cash. Banks generally do not lend on $30,000 houses, which is why every acquisition in this model runs on private capital or the investor’s own funds.
Private lenders in this space typically want to hold the note rather than operate. They earn double-digit returns and avoid tracking payments, filling vacancies, and eviction decisions. Terms and structures vary, so get your own legal and lending guidance before raising capital.
Who pays for repairs under a contract for deed?
The term buyer does. Once the contract is in place, the house is theirs and they make the repairs — which is the structural reason this model can work on inexpensive properties without a maintenance operation behind it.
This is the sharpest contrast with short-term and long-term rentals, where the owner absorbs every repair cost. Specific obligations depend on how the contract is written and on state law.
What happens if the term buyer stops paying?
You face the same judgment call a landlord faces, and it is the risk Vega names as her biggest concern. Late payments are common with lower-income buyers, and deciding when to move to eviction is a real operational decision with no clean answer.
Recovery is unreliable. In one case a buyer went unpaid from August until March, the situation ended in eviction, and the money was never recovered. There is also damage risk if a buyer chooses to leave. Remedies and timelines vary by state, so work with local counsel.
The bottom line
Before you buy a single house on this model, line up the private capital and build the payment-audit routine — a named person reconciling every account against the bank every month, not against a software notification. Capital access determines whether you can play at all, and record-keeping determines whether the $750 a house actually reaches you.
