Contract For Sale And Purchase

The most fundamental single document in a real estate transaction is the contract for sale and purchase. It stipulates all the terms and conditions and defines the obligations and responsibilities of the parties to the Contract. Therefore, utilizing the Contract, assuming that all blanks have been properly filled out and completed, will help assure that the transaction contemplated will occur in the manner desired by the parties.
Sale and Purchase: the Buyer may be an individual, corporation, limited liability company, trust or another form of entity. In many instances, the Contract is executed before the Buyer has had sufficient time to determine if the Property should be purchased in the name of an individual or an entity.
Purchase Price: the Purchase Price is payable in U.S. currency, therefore, it is important to understand that any fluctuation in rates to convert from foreign to U.S. currency are borne by the Buyer who is the party responsible for paying the Purchase Price. The Purchase Price is normally payable in the form of an initial deposit, an additional deposit and the balance at closing, assuming that there is no financing involved. It is always recommended, when setting forth the deposits, to utilize a percentage of the Purchase Price rather than a fixed dollar amount.
Closing Date: it is recommended to state a specific number of days from the Effective Date to determine the Closing Date.
Сlosing Procedure: closing will take place in the county where the Property is located and may be conducted by mail or electronic means. In many instances, closings are conducted electronically, without the need for a physical closing, especially in cases when the Seller or Buyer are out of the country.
Risk of Loss: because of the possibility of damage to the Property through some form of casualty, the Contract states that if the Property is damaged and the Seller can restore the Property by the Closing Date or within forty-live (45) days after the Closing Date to substantially the same condition it was on the Effective Date, hen the Seller will be required to do so.
Effective Date: the “Effective Date” of the Contract is the date on which the last of the parties initials or signs and delivers the final offer or counteroffer.
Time: all time periods will be computed in business days (a “business day” is every calendar day except Saturday. Sunday and national legal holidays). If any deadline falls on a Saturday, Sunday or national legal holiday, performance will be due the next business day.
Force Majeure: in the event of an act of God or force majeure, time periods, including the Closing Date, will be extended, however not to exceed thirty (30) days from the time the force majeure or act of God is in place. In the event the act of God or force majeure continues beyond the thirty (30) days, either party may cancel the Contract by delivering written notice to the other party.
Notices: notices must be in writing and may be delivered by mail, personal delivery or electronic media. Failure to deliver notice in a timely manner regarding any contingency set forth in the Contract will render the contingency, null and void.
Complete Agreement: any agreement of Buyer and Seller, to be binding, must be in writing and signed or initialed and delivered to the party to be bound. This is important because there are many oral representations which are made or misunderstood between the parties and in a Contract for the sale and purchase of real estate, these must be in writing and delivered to be effective.
Default: if Buyer fails to perform this Contract within the time specified, including timely payment of all deposits, Seller may choose to retain and collect all deposits paid and agreed to be paid as liquidated damages.