7 Important Parts of a Purchase Contract.

As a seller, when your agent brings you a contract form a potential buyer, these are the key things that you need to take note of when reviewing whether or not you want to accept the contract.

1. The Closing Date.  Is the date that the buyer wants to close and take possession reasonable for you? 

2.  The Possession Date. In our area the possession date is typically the same date as the closing date.  This is the date that the buyer actually takes possession and can move into the property. In some areas it may be normal for the possession date to occur one or more days after the closing.  If possession is to occur prior to closing then the seller should expect some compensation (rent).

3. The Earnest Money.  How much is the buyer willing to risk? As a seller you should look for the highest earnest money deposit possible, this is forfeited if the buyer backs out, so a larger deposit is usually a good indication of a serious buyer.

4. Fixtures & personal property. Know what items are expected to stay with the property. In our local contracts it is basically written that anything attached to the house (or property) stays and is transferred with the house.  If personal property items are to be transferred that should be clearly stated in the contract as well.

5. Repairs. Determine what the requested repairs will cost and whether you are willing to do the work, or would it be in your better interest to lower the price of the house by that amount.

6. Contingencies.  See what other factors the buyer wants met before the contract is final - Do they want additional inspections? Do they need to sell a home? Obtain a mortgage? Have an attorney review the contract?  Set time limits on any contingencies to keep them from dragging on and preventing the sale from becoming final.

7. The contract expiration date.  How long do you have to make a decision on the offer?