For Sale By Owner Purchase Agreements: Tips to Protect Yourself
If you`re considering buying or selling a home without the help of a real estate agent, it`s essential to have an airtight purchase agreement in place to protect your interests. A purchase agreement is a legally binding contract that outlines the terms and conditions of the sale, and it`s crucial to get it right to avoid potential headaches down the road.
Here are some tips for drafting a strong For Sale By Owner (FSBO) purchase agreement:
Include all necessary information: Your agreement should include all the basic information about the property, such as the address, legal description, and any specific features or amenities. Be sure to list any personal property or fixtures that are included in the sale, such as appliances or fixtures.
Outline the purchase price and payment terms: The agreement should clearly state the purchase price and how it will be paid, such as a lump sum or installments. You should also include a timeline for payment, including due dates and any penalties for late payments.
Include contingencies: A contingency is a condition that must be met before the sale can proceed. Common contingencies include inspections, financing, and the sale of the buyer`s current home. These contingencies protect both parties and ensure that the sale is contingent on specific conditions being met.
Specify closing costs: The agreement should also specify who will pay for closing costs, such as title insurance, attorney fees, and transfer taxes. These costs can add up quickly, so it`s important to know who will be responsible for them upfront.
Address repairs and maintenance: The agreement should outline any repairs or maintenance that must be completed before the sale can close. It should also specify who will be responsible for any repairs that arise after the sale is complete.
Include a timeline for closing: The agreement should include a timeline for closing, including the date by which the sale must be completed. It`s essential to have a clear understanding of the timeline to ensure that everything is completed on schedule.
Include an arbitration clause: An arbitration clause specifies that any disputes that arise must be settled through arbitration rather than litigation. This clause can help save both parties time and money if a dispute arises.
In conclusion, a For Sale By Owner purchase agreement can be a complex document, and it`s crucial to get it right. By including all necessary information, outlining the purchase price and payment terms, including contingencies, specifying closing costs, addressing repairs and maintenance, including a timeline for closing, and adding an arbitration clause, you can protect your interests and ensure a smooth sale.