What are the disadvantages of a contract for deed? Select two. Allows time to become mortgage ready Seller retains the right to the property Down payment and closing costs can be negotiated No professional appraisal is required, so you might pay more than the home is worth

Seller retains the right to the property

No professional appraisal is required, so you might pay more than the home is worth

Explanation:

A contract for deed is one that does not have the standard transfer of title from the seller to the owner. Rather the seller of a property retains title ownership while the buyer pays installmentally over time.

This agreement is common where the buyer does not meet requirements to obtain a loan. A small down payment can be made initially.

Disadvantages of contract for deed includes:

- Seller retains rights to the property, and he can cancel the contract if the buyer defaults even once on his payments.

- No professional appraisal is required, so you might pay more than the home is worth. There is no requirement for appraisal of the property so the buyer does not have a reliable estimate of property worth.

cognitive overload: having a lot on your mind impairs decision-making and tends to result in the simplest, but not necessarily best, option being selected.

empathy gaps: overlooking how you might feel in a different situation can result in unnecessary purchases, such as overbuying when shopping for food on an empty stomach.

optimism and overconfidence: wearing rose-tinted glasses and having unrealistic expectations about the future can affect money management and leave you unprepared for a change in circumstance.

instant gratification: seeking instant gratification drives impulsive spending and can undermine long-term planning and savings.

harmful habits: automatic or mindless behaviour can amplify a poor financial decision as it becomes a recurring event.

social norms: we are heavily influenced by the actions of others; while this can be in certain circumstances, it also contributes to the pressure to keep up with the joneses through conspicuous consumption.