The Real Estate Contract.......
What YOU MUST Know BEFORE you sign on the dotted line!
REinfo4me.com
Check and DOUBLE CHECK
Everything on Your Real Estate Contract!
The real estate OFFER becomes a CONTRACT when it is RATIFIED (signed) by both the buyer and seller
. I can only tell you what happens next in California.
Realtors® use Purchase Agreements (contracts) approved by the California Association of Realtors®.
HOWEVER, whether it is a Realtor® contract or a contract drawn up by an attorney in your State, the basics are very similar.
Your real estate contract will have a price, loan
information, instructions to both parties and certain contingencies that need to be taken care of before closing.
FOR YOUR PROTECTION, ALL REAL ESTATE CONTRACTS MUST HAVE THE FOLLOWING CONTINGENCIES:
LOAN
CONTINGENGY: If you do not get the loan, then all bets are off.
You have already gone a good way to making sure this does not happen to you by getting pre-approved.
APPRAISAL CONTINGENCY: If the house does not appraise at, or more than, the sales price, then no deal.
INSPECTIONS CONTINGENCY: There are several real estate inspections which should be done, and if you or your lender do not approve of the conditions found and not corrected, then again deal kaput.
TITLE
INSURANCE CONTINGENCY: The house must have a clear title and both you and your lender should be issued with a real estate title insurance policy.
No title insurance, no deal.
ZONING AND USE LAWS: The structure and property must be in compliance with local and State laws.
HOMEOWNERS INSURANCE CONTINGENCY: This is one that is not usual in most purchase agreements.
It should be included.
If you can't get insurance, then you can't get your real estate loan!
There are many INSPECTIONS which you NEED to have professionally done and these should be a part of your real estate contract.
All of these do not necessarily apply to every area, and there may be other local inspection advisories which are not listed here.
Check with your real estate AGENT regarding local practices.
Please follow the links as there is too much info on some of these categories, and I can only give a brief description here.
SOME COMMON INSPECTIONS ARE:
HOME INSPECTION: This is an absolute must have in your real estate contract. Here are the basics. A home inspector will check out the home and it's components and let you know what is sound and what should require attention. A home inspector should be in the primary business of home inspection, and not a contractor who may have a hidden agenda to get some more business doing the repairs. There may be some things beyond the scope of the inspector and they should recommend the further inspection be done by an appropriate professional.
TERMITE INSPECTION: Most homes have wood in the construction. Older homes especially, are likely to have some kind of wood destroying pest in residence. A termite inspection will give you a report of any infestation or damage done to the house.
ENVIRONMENTAL AND NATURAL HAZARDS: There are several things involved here including, but not limited to; industrial waste, noise pollution, earthquake zones, flood planes, fire hazard areas, nature conservancy regulations etc. You should have your agent ask the seller for a report from a hazard disclosure company.
HOMEOWNERS INSURANCE: Insurance is vital. You will not get your loan without providing a policy for your lender. You need to ascertain if any claims have been made against the property, especially within the last five years. Have your agent ask the seller and double check the answer with your insurance agent.
SQUARE FOOTAGE, LOT SIZE AND BOUNDERIES: In order to determine if the square footage is as represented, and the boundaries are correct where they appear to be, you will need a licensed appraiser or surveyor. Be careful about any easements that are on the property, either yours or the neighbors.
MOLD: Toxic mold can be very dangerous to your health! If you have concerns about it, you should have the property inspected for mold by an environmental hygienist or professional during the contingency period.
OTHER THINGS TO NOTE IN YOUR REAL ESTATE CONTRACT:
Septic Systems and Private Water Supply: These should be inspected and certified.
Sex Offender Criminal Database: If there is a database available to the public, you should check to see if any of your future neighbors are on it. 
Schools: Just because there is a school nearby, it doesn't mean that this will be the one your kids will go to. You need to check with the school district.
Click here for free school information
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