©copyright, 2010 florida realtors® 1 the effective sales and purchase contract by: steven j....

©Copyright, 2010 Florida Realtors®1

TheEffectiveSales and Purchase ContractBy: Steven J. David, CRB,CRS,GRI

Presented by:

Florida Realtors®

©Copyright, 2010 Florida Realtors® 2

Course Objectives:By drafting an effective purchase and sales contract

The student is empowered to:

• Explain the agreement

• Identify timing and use of disclosures.

• Reduce litigation


Course Topics:

Basics of a contract

Required disclosures

Review of the contract form

Workshop activity

Changes, counter-offers, conditions


The Contract

Represents desires of all parties

Instructs the closing agent


Purchaser’s Name

Purchaser’s Name

Legal Description

Legal Description

Use of Property

Use of Property

Personal Property

Personal Property

Purchaser Price

Purchaser Price

Terms ofPurchase

Terms ofPurchase

The Basics


The Basics

AcceptanceDate

AcceptanceDate

ClosingDate

ClosingDate

RepairLimitations

RepairLimitations

SpecialClauses

SpecialClauses

SignaturesSignatures


The Basics

EVERYTHINGshould be in writing

Most problems are due to miscommunication


Purchaser’s nameLegal descriptionPersonal propertyUse of propertyPurchase priceTerms of purchase

Acceptance dateClosing dateRepair limitationsSpecial clausesSignatures


Required Disclosures

Which disclosures must be given?

When are they given?


Attorney’s fee Survey

Escrow balance Title Insurance

Hazard insurance Mtg Transfer Fee

Abstract recertification

Appraisal

Disclosures – Cost/Fees


Disclosures - Costs/Fees

Credit report Prepaid escrows

Documentary Stamps

Origination fees

Lender’s attorney fees

Other


Lead-based Paint

FHA-Mandated Home Inspection

Energy efficiency

Agency

Controlled business arrangements

Other Disclosures

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Other Disclosures Mold Homeowner’s Association Property Tax Increase Warning 2003 Law Changes

Material Facts DisclosureHIVDeath

©Copyright, 2010 Florida Realtors®


Financing Agency Homeowner’s assoc Property tax Hazardous materials Inspections Equal housing Leases


We will discuss the contract most often used in your area.

16

Filling in the Blanks Legal Description Complete address Personal property - included Personal property - excluded Leased equipment Seller representations



Filling in the blanks Deposit Additional deposit Amount of new note Existing mortgage Purchase money Other consideration Balance of funds Total purchase price


Filling in the Blanks

FHA or VA

CondominiumsFHA or VA

Condominiums

Special Clauses

Special Clauses

Acceptance

dateAcceptance

date


Filling in the blanks

Closing Date

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Filling in the Blanks Old mortgages New mortgages Assignment Survey Inspections Environmental

condition

Radon gas Insurance Leases Seller’s affidavit Place of closing Documents for

closing


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Filling in the Blanks

ExpensesPro-rations Other pro-rationsSpecial

AssessmentsRisk of lossMaintenance

Escrow proceeds Escrow deposits Default Non-recordable Survival of

covenants



Final Agreement Special Clauses Signature Section

Sign only if you have actually received the deposit!

NOTE: The riders for VA, FHA etc. will be discussed thoroughly at this time.


Changes?Counter-offers?Conditions?

A counter-offer is a change in the offer from one party to the other

May use a clean contract Initial/sign all changes


Submit offers/counter offers ASAP Parties can cancel before acceptance Get EVERYTHING in writing

Don’t Forget!


Track time constraints

Initials/signatures on changes Submit offers ASAP May cancel before acceptance

Submit counter offers ASAP Verify all deposits in writing

Avoid verbal offers

©copyright, 2010 florida realtors® 1 the effective sales and purchase contract by: steven j....

Documents

florida realtors

miscommunication slide

litigation slide

closing agent slide

purchase contract

required disclosures

effective purchase

disclosures review