Summarize:

Carefully read the contract and determine whether all of elements required under state law are present in the contract. If a seller fails to include a required element, in some states buyers may have the option to terminate the contract. The clause will contain instructions for rescinding the contract and state the time in which you have to do so. If still within the time specified by the clause, follow the instructions provided in the contract on how to rescind the contract. States may have specific rules about how to rescind a contract, which may include providing written notice. If you contract has a rescission clause, you will be required to provide written notice of your decision to rescind. This written documentation may include a signed rescission form, previously provided to you or a simple letter stating that you are rescinding the contract. You may also be required to provide the following information:  The name, address, and phone number of the seller or his or her attorney. A description of the contract for deed, including the names of the parties. A description of the property. A statement of rescission, including when the contract will be rescinded and the basis for the rescission. A list of all payments made under the contract. If your contract does not contain a rescission clause, review your state’s statutes to see if a rescission period may apply. Some state and federal laws require that certain contracts allow for rescission within a specific period, usually three (3) to ten (10) days after entering into the contract. There are limited circumstances, under which a party can terminate a contract. These remedies are not specific to contracts for deed, however some states allow general contract remedies to apply to contracts for deed. A buyer may be able to terminate a contract for deed for the following reasons:   Fraud and misrepresentation. You may be able to cancel the contract if you can show that the seller lied about the condition of the property, and that lie induced you to enter into the contract.  Breach of contract by the other party. If one party knowingly fails to comply with the terms of the contract, the other party may terminate the contract. A breaching party has no right to complain that the other has ended the contract, which he or she breached.   Impossibility. If a party to a contract is unable to perform his or her obligations due to the impossibility of such performance, he or she may have a legal right to terminate the contract. The reason for the impossibility of performance must not be the fault of the party who finds it impossible to perform. It must be either the fault of the other party or the result of an “act of God” or act of nature, such as a hurricane or tornado.  For example, if a tornado damages the property beyond repair before you have take possession of it, you may be able to legally cancel the contract for the deed.   Failure to hold unencumbered title. If a seller has an improper lien, mortgage or other encumbrance on the property, some states do not allow a seller to execute a contract for deed on the property. You should check your state laws to see whether it prohibits an encumbered property from being the subject of contract for deed. If it does, you should run a title check on the property in question to see whether there are any liens on the property. If so, you may have a legal basis to terminate the contract.
Determine whether the contract meets minimum state requirements. Review the contract for a rescission or cancellation clause. Provide written notice. Determine if you have any legal right to terminate the contract.