The Buying Process
A properly written contract sets forth the terms of the sale and protects the interests of both buyer and seller.
The contract specifies the terms of the sale and the rights and obligations of the buyer and the seller. A well-written document protects both parties, while a poorly drafted contract can cause serious problems.
Get it in Writing
Oral agreements are usually difficult or impossible to enforce, so if you’ve negotiated your purchase verbally make sure to have contracts signed as soon as possible.
Cover All Contingencies
Make sure that the contract covers all contingencies of the purchase and allows sufficient time for any required activities or testing (i.e. obtaining a mortgage, home inspections, etc.). Reasonable contingencies are essential to protecting yourself in the purchase – don’t allow anyone to pressure you into skimping on due diligence.
Learn About Deeds and Title
The deed is a legal document that transfers ownership of the home. There are several types of deed that can be used for your purchase as well as a number of special provisions that may apply to your new home. Your agent or escrow agent can answer any questions you have on title and deeds.
Know Your Deposit Obligations
The contract should specify the due dates and disposition of earnest money and deposits. Typically a small amount is posted at the signing of the contract with the balance of the deposit (usually 10% of the purchase price) due within 1-3 weeks. Don’t agree to a schedule you cannot meet – if you need extra time to line up the funds, specify this in the contract.