Business Purchase Contract. These tips are excerpted from my fourth real estate book: “1001 Tips for Buying and Selling a Home” by Mark Nash. ISBN: 0324232896 Thomson/South-Western 2004.
464 unless you are in a “hot” market area, do not feel pressured to write a purchase agreement after a showing.
-If you need some time, use the old “I’d like to sleep on it.”
-You will feel more confident in the purchase agreement when you have not been hurried into it.
-It is usually a good idea to revisit the property prior to making an offer.
468 Learn how to protect yourself by using contigencies.
-A contingency is added to a contract and states that some action must either be taken, or not taken, or the contract will become void with no penalty.
-A typical contingency is on the purchaser being able to obtain financing at the terms described in the purchase contract.
-Contingencies may also be for a variety of home inspections, sale of another property, removal or inclusion of items on the property, or anything else that is important to you.
-The seller does not have to accept your proposed contingency and may reject the contract but at no penalty to you.
472 Do not allow your real estate agent to arbitrarily waive any contingencies for financing or appraisal in your purchase contract.
-In a hot market, it will be tempting to waive contingencies for financing or appraisal in order to make your offer more attractive.
-If you waive the contigency for either obtainig financing or having an appraisal and are not able to go through with the transaction, you could be subject to a lawsuit.
727 Require all offers on your home to be in writing.
734 Remember price is one of many terms of a successful offer.
-Investigate what percentage of list price, homes have sold for in your market in the last six months.
-A full rpice offer from a buyer who can’t provide a mortgage committment is a weak buyer.
-Be flexible in trading price for terms, or terms for price.
-Some buyers will pay more for a closing date that meets their needs.
-Always respond to low-ball offers with a counteroffer, buyers might be testing you out on their first price offer.
855 Establish what is customary in your market: will you be receiving an “offer to purchase” or a “real estate contract” on your property?
-Offer: a proposal to orginate a contract.
-Contract: parties agree to do or not to do defined legal acts and consideration is exchanged.
857 do not propose terms if you can’t live with them; be aware of what you say and when you say it.
862 Consider your options if you receive multiple offers at one time for your home.
-Compare the strengths and weaknesses of all offers on a worksheet provided by you real estate agent.
-You can negotiate each offer seperately or respond to all with a request for their “highest and best offer.”
864 Have an attorney review all contracts on the sale or purchase of a home, before you sign them.
865 Take special note of the earnest money being offered with the contract.
-A strong price and weak earnest money, down payment, or credit could indicate a lower probability of buyer’s ability to close the transaction.
-Earnest money shows the buyer’s willingness to perform a contract and go to closing.
-It is common in some markets for the earnest money to be delivered in two steps. First an amount is delivered with accepted contract or offer and a second amount is delivered after inspection and attorney periods have expired or issues resolved to both parties satisfaction.
867 Do your buyers have a home to sell? Is it already on market? Buyers needing equity from their current home to purchase yours is typical. Look for their property to be listed, priced correctly, and typical in style, condition, and features for market.
869 Pay special attention to any requested contingencies in the contract.
-The longer a contingency period, the higher the probability of the buyer exercising its use.
-Request business days for contingencies. Business days are Monday through Friday excluding holidays.
-Attorney and inspection contingencies should run at the same time and for no more than seven business days.
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