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San Diego real estate library
Real Estate – Being Aware of a real estate sales contract
Most real estate contracts can seem exceptionally
overwhelming with their complex real estate terms that you might
not understand. This article helps describe different terms in
an uncomplicated way.
So, the obvious is stated, who is buying the property from whom.
It also lists the property address as well as the legal
description. This is for everyone's security. There have been
times when a property was offered for sale at a particular
address. The transaction took place and the deal was closed.
Later it was discovered the property sold was actually adjacent
to the one on the contract. This has actually happened quite
often with vacant land. By using the legal description on the
real estate sales contract there is no doubt which property is
involved in the transaction.
The purchase offer is also listed along with any down payment,
or earnest money, the buyer may have put down. The terms
clarified here as to when the buyer will obtain the loan and how
much the loan will be for. You will find a date for closing in
this area as well. The closing date is given as an approximate.
This is because circumstances may arise which could delay the
closing. This is taken into consideration. There could be a
section about the appraisal of the property, depending on how
your contract reads.
You will acquire information on the sales agreement concerning
inspections. This is because every buyer has the right to have
the home inspected before the contract is finalized. This is
encouraged because there could be hidden damage that no one knew
about. Things like termites and other infestations can be
checked for with a quality inspection. Many times the seller
must have a termite inspection done before closing.
The real estate sales contract also includes a warning clause
for the buyer. This is the “As Is” terms the buyer is purchasing
the property under. He or she has entitlement to have the home
inspected. Any thing which is not addressed in the contract or
during the inspection becomes an “as is” issue. The seller can
not be held responsible for any damages unless it was proven the
problem was known and not disclosed to the buyer. For instance,
if the basement floods every year and no one said anything, the
seller can be held responsible for taking care of the problem.
The real estate sales contract will list any options the buyer
wishes to add. For example, they might ask the seller leave the
appliances or other things. Additionally, they can ask the
seller to pay certain closing costs or hold a note for a set
period of time. There may be other terms the buyer may wish to
add.
The seller has the right to discard the contract completely,
agree to it as is, or counter with an offer of his own. The
seller can ask the purchase offer listed to be higher, if it is
not the asking price. This is where the negotiations come into
play. Not every real estate purchase contract is accepted the
first time it is submitted. Negotiating the deal is not unusual.
It is acceptable to ensure both parties are happy with the
agreement. This is why the real estate sales contract usually
states at the top that it is a real estate purchase agreement.
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