When purchasing a home, it’s important to ensure that the contract is written in such a manner as to protect both the vendor and purchaser.
Quite often in a real estate transaction, before an agreement on the sale is reached there will be back and forth offers and counter-offers.
When using a realtor, their profession has set rules and protocols that are followed throughout that process.
But in a private sale, it is paramount to have a contract written up by a lawyer or a notary both of who know the legalities when acting on behalf of the purchaser and vendor.
Of prime importance is ensuring any changes made to an offer are initialed by both parties involved in the process. For example, the initial offer is a starting point of the negotiation for the final agreement in the price of the property. The contract will set out the completion and possession dates.
The completion date is the day funds will be transferred to the vendor and the possession date is just that—when the property actually changes hands and you can move in.
There will be various subject clauses attached to the contract. Subjects are placed in the contract to protect the purchaser’s initial deposit and allow time to arrange financing, have a home inspection and various other components that form part of the offer to purchase.
There will also be additions to the contract to protect the vendors of the property.
A property disclosure statement is a necessary part of the contract. This statement will be initialed and signed by the vendor and will provide information with regards to the property. It will state some of the following:
• if the property has been or is a former grow operation
• is there a problem with the septic tank and field if the property is not on a municipal system
• are the furnace and hot water tank in good running order and when was the last time they were replaced.