"On contract" refers to an installment land sale contract. This is a device under which the seller retains legal title to the property until either all or a certain percentage of the puchase price is paid. The buyer has equitable title during the executory period of the contract and the seller coveys legal title upon completion of required payments. 

     This device is sometimes used to hide the transaction from the bank for fear that the bank might, upon discovery of the purchase, exercise or threaten to exercise a due-on-sale clause in its mortgages to leverage a higher rate of interest and loan origination fees from the purchaser.  It does not appear that the device was used for that purpose here because Freese soon communicated with the bank concerning the amount of debt secured by the mortgage.