What Should Be In A Real Estate Contract?
One of the most common jobs at a real estate law firm is putting together contracts to enable buying and selling. Making a property deal requires more than simply supplying the title and providing payment. Let's look at 5 sections that need to be in every real estate contract.
Information About the Property
It's important to clearly describe a property in a manner that ensures both parties are agreeing on the same thing. This means making sure the address listed in the contract is correct, and it's also wise to include any identifying information from the county registry, too. If the property is being subdivided, that process should be completed with the county before a sale goes forward.
The total purchase price of the property ought to be listed in the contract. Similarly, it's a good idea to include any funding sources that will be used to make ongoing payments. This usually means a loan from a bank, and it's also worth including the name and contact information for the bank. If a deposit is being made, that amount should be included in the agreement, too. Otherwise, there's a risk the contract will not be properly activated.
Questions often arise in contracts about when the property officially belongs to the purchaser. The closing date makes sure everyone involved knows when the sale is final. Hold onto the keys for the location until the sale is finalized.
Who Pays What
It's not uncommon for reports to be included with sales. These usually cover engineering issues with the building and the ground, and they may also cover things like detecting common issues such as the presence of carbon monoxide and radon. You may also need to pay fees to the local, state, and federal governments to get copies of paperwork and older reports. It's best to be explicit about who is paying these costs.
Disposition of Other Property at the Location
People frequently throw in other forms of property with sales of real estate. This occurs for a slew of reasons, including sweetening the deal and just not being interested in moving stuff. Regardless of what's being included or not, there should be a full accounting of all the property at the location and what its disposition will be. This will avoid disputes about the removal or use of items outside the terms of the contract. If something unwanted has to be moved, the terms should include who is responsible for moving it and paying removal expenses.
To learn more, contact a real estate law firm.