Overview of the Real Estate Contract
The real estate contract is the agreement between the purchaser(s) and seller(s) that describes the property being conveyed and sets out the terms and conditions of the transaction. It is imperative that all parties read the purchase and sale contract before signing to ensure all material issues are addressed. Listed below are some of the important items contained in the purchase and sale agreement:
- The legal description of the property being transferred. This legal description must be sufficient to identify and locate the property.
- The exact purchase price or an exact method of determining the purchase price (i.e. $15,000 per acre).
- The method of payment by the purchaser. The buyer may make the sale contingent upon financing.
- The amount the seller agrees to contribute toward buyer’s closing costs, if any.
- The amount of earnest money paid by the buyer and the party holding the earnest money deposit.
- The date of closing and the date the purchaser will take possession of the property.
- The time-frame for both the inspections and the resolution of issues arising from the inspections.
- Special stipulations specified by the parties.