| A real estate purchase agreement is not a | | | | Designation Of Who Pays What - Make sure the |
| rough guide to a deal. It is a contract | | | | agreement clearly states who will pay for |
| specifying exactly what legal obligations | | | | what. Are you splitting the cost of the fee |
| each side has. In other words, be sure it | | | | paid to the closing company? Who is paying |
| says what you want it to say, and has | | | | each of the other closing costs. If it |
| everything you need in it. | | | | doesn't state in the purchase agreement that |
| | | | the seller is paying, expect that you are. |
| Normally, if you are buying a property that | | | | |
| is listed with a real estate broker, they | | | | Financing Contingency - Unless you are paying |
| will have a purchase agreement ready to have | | | | cash, you will probably have to get a loan. A |
| the blanks filled in. If you have a buyer's | | | | Pre-approval from the bank doesn't guarantee |
| agent that you work with, he or she will have | | | | much, so be sure that you make the agreement |
| the necessary forms. There are the routine | | | | contingent on getting that loan, and specify |
| parts which are necessary, but not easily | | | | the terms. For example, it might read, "This |
| forgotten or done wrong. These include the | | | | offer is contingent on buyer obtaining a |
| following. | | | | mortgage loan within seven days, at 7.5% |
| | | | annual interest or less." |
| The Date - Names of Buyer(s) and Seller(s) - | | | | |
| Address Of Property - Legal Description Of | | | | Inspection Contingency - You may not need an |
| Property - Purchase Price And Terms - List Of | | | | inspection if you are buying land, but with |
| Anything Included With Property - Date The | | | | residential real estate an inspection is a |
| Deal Should Close By - Closing Process - | | | | good idea. Generally, the clause for this |
| Disclosure Statement - Signature With Date | | | | will allow you about a week or ten days to |
| For Buyer And Seller - Addresses and Phone | | | | get it done. It might read something like |
| Numbers Of Buyer And Seller. | | | | this: "This offer is contingent on an |
| | | | inspection of the property at buyer's |
| These may be routine items, but be sure that | | | | expense, and buyer's approval of the results |
| you look all of this over carefully. If the | | | | of that inspection within seven days." |
| disclosure statement clearly states that | | | | |
| there is a foundation problem, for example, | | | | Other Terms, Conditions or Contingencies - |
| you can't later get out of the deal when | | | | There are sometimes other issues, and you |
| those cracks in the basement make you | | | | have to address them in the real estate |
| nervous. With the following items, be | | | | purchase agreement. For example, if the back |
| especially careful. | | | | yard is full of junk cars, you better add a |
| | | | clause like, "All cars and junk to be removed |
| Real Estate Purchase Agreement - The Crucial | | | | at seller's expense before closing." If you |
| Items | | | | are shopping alone but your wife needs to |
| | | | approve the home, you could also add a clause |
| Good Faith Deposit or Earnest Money - Real | | | | like, "Offer is subject to a approval by |
| estate agents will try to convince you that | | | | spouse within two days." Then your wife can |
| your deposit should be as much as possible. | | | | look at the house later and say yes or no to |
| There is no "normal" amount, and while it's | | | | the deal. As you can imagine, sellers may not |
| true that a seller might take an offer more | | | | like that one. |
| seriously with a bigger deposit, this is up | | | | |
| to you. Real estate is regularly bought with | | | | If you are not working with an agent, you can |
| $500 deposits. An alternative is to include a | | | | buy an agreement (sometimes called an "offer |
| deposit of $200, and the line, "to be | | | | to purchase" or "buy-sell agreement") online |
| increased to $2,000 when all contingencies | | | | or in some office supply stores. Having a |
| are satisfied." That way if the inspection | | | | lawyer review all the paperwork is best. |
| shows nasty surprises your money isn't tied | | | | Remember that a real estate purchase |
| up while the seller argues that there isn't a | | | | agreement is a binding contract the moment |
| problem. | | | | you and the other party sign it. |
| | | | |