You need a written contract when buying or selling a home. A real estate sales agreement is what real estate agents and attorneys use to establish how the deal moves forward to the closing. Here’s a brief guide to this crucial legal document. 

What Is a Purchase Agreement?

A real estate purchase agreement is a legal contract between a property buyer and seller that states the price and terms under which the buyer will purchase the property from the owner. The document may also be called a real estate sales agreement. Under Massachusetts real estate law, it’s referred to as a Purchase and Sale (P&S) Agreement.

What’s Included in the Agreement?

A real estate purchase agreement includes the sales price, property description, the amount of earnest money from the buyer, who will hold the deposit, and the closing date. Provisions for the broker’s fee, liability for damages if the buyer defaults, and for damage or destruction of the property before the closing are also included. 

The P&S agreement includes standard contingencies that let the buyer opt out of the purchase, negotiate a lower price, or extend the closing date under certain conditions. Contingencies such as failure to appraise for the selling price, unsatisfactory home and pest inspections, and septic and water quality problems are typically included. A standard financing contingency allows a purchaser to secure a firm mortgage commitment by a certain agreed date under prevailing interest rates, loan terms, and conditions.    

Before buying or selling a home, let Bernardini Law P.C. in North Andover, MA, prepare or review your real estate sales agreement.  Attorney Christine Bernardini offers more than a decade of experience in real estate law, including P&S agreements. You’ll receive sound legal advice and representation that protects your interests throughout the transaction. Call (978) 794-5525 to schedule a consultation, or visit the firm online to learn more about their services.