A Real Estate Contract is more commonly known as a Purchase Agreement. It is a legal document that states that the seller will sell their property and turn over the property title in exchange for an agreed amount of money. While Real Estate Contracts are normally drawn up by an attorney, often times the real estate agent fills in the blanks and then both the buyer and seller sign the contract to make it legally binding.
If you are buying property in Miami you won't have to prepare your own buyer's agreement, but knowing what goes into a strong real estate contract will help you to make sure that your contract contains everything that you need.
What A Good Real Estate Contract Includes:
There are a few things that a strong Real Estate contract needs to contain including:
Price- Your purchase agreement should state the price that you and the seller have agreed that you will pay for the property.
Earnest Money Deposit- An Earnest money deposit is a deposit that is made to prove you are a serious buyer. The amount of the deposit goes towards your down payment or closing costs Usually 1% or 2% of the total purchase price
Property Address and Description- So there is no doubt as to what property you are purchasing.
Sales/ Closing Date: The contract should also include the date the sale will close if all of the other parts of the contract are met.
Important Details/ Terms of Sale Your Real Estate Contract needs to include important details of what needs to be fulfilled. Details may include such things as adjustments that will be made to liabilities, property taxes and other fees. In addition, the contract should also include the details of who will be paying for surveys, title insurance, and inspections.
Final Walk Through Date- The final walk through date is to make sure that property remains the same as it was when you agreed to buy, or that the seller completed certain obligations that they agreed in order to receive the full purchase price.
Any Contingencies- Contingencies actually protect the buyer. If the contingency cannot be fulfilled the buyer can back out of the deal without having to pay any penalties and will be able to get their full deposit back. Contingencies may include such things as the contract being dependent on the buyer being able to get approved for financing or the results of a home inspection.
Once all of the conditions of the contract are met by both parties, then money and title are exchanged and the property is yours.
A good Real Estate Contract will protect the interests of both the buyer and the seller. Should there be any dispute about any of the points regarding the sale the courts will be able to determine what the party’s intent was and whether or not each party has fulfilled all of their obligations under the contract.