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The Purchase Contract The purchase contract is
the legally binding document that sets forth the terms of the sale, establishes
the rights and obligations of the parties involved, specifies the actions to be
taken in order to close the sale, and establishes the time frames for those
steps to be completed. A
contract is created when there is a "meeting of the minds" on all
terms. The contract is created when the buyer and seller have come to such
agreement and signed the offer form along with any counter-offers and addenda.
Real estate contracts must be in writing; verbal contracts to purchase real
estate cannot be enforced. Prior to signing a contract to buy or sell real
property it is important to understand all of the terms to which you may be
obligating yourself. Typically
standard pre-printed purchase contract forms are utilized and filled out by the
real estate agents handling the transaction or by the principals if there is no
agent involved. While most buyers and sellers are usually fully aware of the
terms such as price, closing date, and financial terms, there is tendency to
overlook much of the pre-printed portion of the form. Since all the terms of the
contract can be binding it is important to understand all of the terms that you
are agreeing to before you sign the contract. Not doing so can be a costly
mistake, especially if there are problems or difficulties in the transaction. Some
of the items that you may be agreeing to when you sign the pre-printed form may
include: ·
What personal property will be included or excluded from the sale ·
Who will pay for required repairs or retrofits ·
What the seller's disclosure obligations will be ·
What the seller's obligation to maintain the property will be ·
What the seller is warranting about the property ·
What the buyers inspection rights will be ·
What will happen in the event either party does not comply with the
contract ·
What the parties legal rights and attorney fee provisions will be in the
event of a breach of contract A
purchase and sale agreement usually provides that the seller must give the
purchasers a warranty deed. That deed warrants that the seller has good title to
the property and that he or she will defend you against others who may claim to
have an ownership interest in the home you are buying. If the seller has only a
leasehold interest in the property, then he or she can sell only that leasehold
interest, and not title to the property. It
is highly recommended that you read and review the pre-printed forms used most
commonly in your area before you have an offer to purchase from a buyer. Your
real estate agent can provide you copies of the forms and should be willing to
explain and review them with you. When you have a bona-fide offer being
presented your focus will be on issues such as price, terms, and closing date.
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Send
mail to randy@randydurham.com
with questions, comments or requests for info. Copyright © 1999-2008 Randy Durham ,LLC
Licensed in TN & GA (423) 664-1900
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