The Key Sections in a Real Estate Purchase Contract – Mono – The Purchase Contract
When buying or selling real estate, the purchase contract is one of the most important documents involved in the transaction. This document lays out all of the terms and conditions of the sale, so it’s essential to understand what’s included in each section. Here’s a breakdown of some of the key sections in a real estate purchase contract from a real estate office nearby in Mono, Ontario.
Purchaser Information: This section contains information about the purchaser, such as name, address and contact information. It also includes disclosures about whether the buyer has been pre-approved for a mortgage loan.
Property Description: This section provides details about the property being purchased, including its legal description, square footage and zoning classification. It also lists any existing liens or encumbrances on the property.
Purchase Price: This section specifies the purchase price or fair market value of the real estate and any seller concessions, including closing costs paid by either party. It also includes a deposit schedule with amounts that must be put down at different stages in the transaction to ensure both parties have adequate funds throughout the process.
Earnest Money Deposit: The earnest money is an amount required from each purchaser as part of their commitment to buy real estate before they can formally enter into a contract on it. You may use your realtor’s Earnest Money Escrow Account or provide a cheque made out directly to “seller”. If you are not using your realtor for this purpose, then you will need to establish another account.
The Purchase Price section sets forth the agreed-upon price for the property. In most cases, this will be the final amount that is paid at closing. However, it’s important to note that if the buyer fails to close on the property for any reason, they may be liable for damages including costs incurred by the seller such as real estate commissions, legal fees, and other expenses.
The Seller’s Representations and Warranties section lists out any guarantees or promises the seller is making to the buyer. This could include things like the property being free of liens or that it meets all zoning requirements. If the seller fails to uphold any of these representations or warranties, they may be liable to the buyer for damages.
The Conditions of Sale section outlines the various conditions that must be met before the sale can go through. This could include things like the buyer obtaining a mortgage commitment or the property passing an inspection. If one of these conditions isn’t met, either party may back out of the deal without penalty.
The Closing Date section sets forth when the title to the property will be transferred to the buyer. In most real estate purchase contracts, this is when you’ll get possession of your new home, but it could also include a number of other conditions including financing being approved and an appraisal on the property coming in above or below the agreed-upon price.
The final sections are usually about how to handle disputes between buyer and seller if they arise down the road on matters not foreseen when this real estate purchase contract was signed. It outlines steps to take if one side wants out of the deal due to unforeseen circumstances, such as financial hardship caused by job loss or unexpected illness requiring expensive medical care beyond their budget limits. The last few pages cover any additional real estate purchase contract details that weren’t included in the main body of the agreement.
It’s important to work with an attorney when composing a real estate purchase contract because there are many rules and regulations as well as local laws to consider. The real estate purchase contract is also subject to specific laws on real property transactions, which can vary from one location to another even within the same region or province.
With real estate purchases in Mono, Ontario, it’s important to be aware of the different terms and conditions involved in each section. If you have any questions about real estate purchase contracts or are ready to begin your real estate search for a new home, please contact us.