Real Estate Contracts

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Contracts

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A legal enforceable agreement between two or more parties . to do or not to do something

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Different types of contracts in real estate

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These include sale contract listing, lease and property management agreement

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To most common types contracts used by real estate broker

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Listing and sales contracts

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Riders

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Additional clause or agreement that become part of the contracts

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Time is of the essence

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Mean that dates and time limits in the contracts must be met.

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Binder

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Short version of agreement between the parties and include All the essential terms.signed by the parties and effective until the longer more complex contracts is completed.

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Express contracts

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Parties show their intentions by words ( either oral or written word)

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Real estate listings and sale contracts are

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Express contracts

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Implied contracts

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Parties intentions are shown by their acts and conduct

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Unilateral contracts

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One party makes a promise to persuade a second party to act.party making the promise is obligated to keep the promise only if the second party act.

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Executed contracts

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All parties have preformed the contact provision have been completed

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Executory contracts

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Have not been completed. Some of the terms remain to be carried out

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Valid contracts

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Contains all the required contracts elements and is blinding on both parties

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Void contracts

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Does not meet all required contracts elements.because it’s missing one or more contracts elements

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Listing contracts

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The seller name is forged

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Voidable contracts

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One in which at least one of the parties has the power to either rescind cancel or enforce the contracts at will

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Unenforceable contracts

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Appears to be valid but is not legally enforceable by either party in a court of law

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Option to purchase

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Separate contracts giving one party the right to do something within a certain time period.

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Real estate sales contracts (also called a purchase agreement)

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An agreement between the buyer and the seller that specified the terms and conditions for the sale of real estate

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Buyer

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(Vendee)take possession and is obligated to pay taxes Maintance and insurance and also get equitable title

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Five required elements of a contract

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1)legally competent parties

2) offer and acceptance also referred to as meeting of the minds

3) reality of consent

4)consideration

5) legality of object

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Novation

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The substitution of a new contract for an old one between the same or new parties

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Liquidated damages

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Is an amount of money to be paid as compensation if one parties breaches contracts

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Mortgage contingency

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Make the contract conditioned on the buyer obtaining a mortgage with the terms specified in the contingency

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Equitable vs.legal title

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Buyer and seller signed a real estate sale contracts.Buyer does not receive the legal title because that will be delivered later by a deed. however the buyer does receive equitable title which means the law recognizes some ownership interest by the buyer even thought the buyer is not yet the owner of records

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Contingencies

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Must be satisfied before the contracts is enforceable

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Mortgage contingency

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Make the contact conditioned on the buyer obtaining a mortgage with the terms specified in the contingency

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Property sale contingency

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Make the contract conditioned on the sale if the purchase current home this prospects the buyer from owning two home at the same time

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Inspection contingency

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Make the contract conditioned on obtaining the results of specified inspections within a set time frame

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Installment sales contracts also known as selling under contract, land contracts, contracts for deed, or articles of agreement

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This type of sales contracts the seller receives a down payment and finances the balance owed by the buyer

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Seller

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Vendor