The Offer Contract: What You Need to Know

It’s been one exciting turn after another – you thought it was impossible, but found the perfect home. You made an offer thinking it would be rejected but it was accepted. But the fun doesn’t stop here. It’s time for the offer contract or purchase contract.

The purchase contract is set in place to help both the buyer and seller. It solves a common dilemma: the seller doesn’t want to hand over the title until he gets the cash and the buyer doesn’t want to hand over the cash until he gets the title. The contract outlines all the responsibilities and commitments that must take place in order for the title-money exchange to take place. Here are a few diehard rules to follow in order to get what you really need out of your contract.

Get it in writing

Always, always put everything in writing. Never make an oral offer or contract. Just because something has been said and you clearly remember it doesn’t mean it’s a valid point. A good well-written contract will adequately protect both parties in writing.

Make sure it’s all there

When the contract signed by both parties (or ratified) you can be held responsible to whatever it says. This also works in the other direction as well. If you leave something out of the contract that you have agreed upon verbally, you are unlikely to get it. The date, amount of deposit, names of both parties, capacity as buyer or seller, the full purchase price, complete legal description and address of the property should all be included.

Who gets what?

Every broker or agent who gets compensated for the sale should be named in the contract along with the amount they are to receive.

There are several contingencies that may or may not be included in the contract. These can include things like earnest money or a deposit that was put down. Be sure the contract includes any conditions you need to meet in order to get your deposit back. If there is a financing contingency, makes sure the contract states what form of financing is acceptable. 

It’s true that contracts long and complicated documents; the only way to approach offer contracts are with patience, perseverance and tenacity.