Document Genius

Real Estate Purchase Agreement Template

Make your real estate transaction easier with a Real Estate Purchase Agreement template that sets clear terms for both buyer and seller.

4.8
1,916 Ratings
  • Duration 2 min
  • Download as PDF and Word
  • E-sign included

How It Works?

1

Fill in the Details

Provide the details of the property, including address, sale price, and the names of the buyer and seller.

2

Customize the Agreement

Adjust the terms for payment, contingencies, inspection timelines, and closing conditions.

3

Sign and Finalize

Both parties review the terms, sign the agreement, and secure copies to confirm the transaction.

A Real Estate Purchase Agreement is a legal contract between a buyer and a seller. It explains the details of the sale, like the price, payment terms, and any conditions that need to be met before the deal is final. This agreement helps make sure both sides understand their responsibilities and protects everyone involved during the buying and selling process.

The contract becomes legally binding once both parties have signed and the buyer is notified of the seller’s acceptance. This agreement is used for all types of residential property sales, including previously owned homes and newly built homes that are completed before closing.

Does a Real Estate Purchase Agreement need to be notarized?

No, a Real Estate Purchase Agreement does not need to be notarized to be legally binding, as it’s not filed with local county records. Some states or lenders may require notarization for documents like the deed or mortgage. Notarization can help verify identities and provide extra security.

Table of Contents

  1. Key Considerations for a Real Estate Purchase
  2. How to Write a Real Estate Purchase Agreement?
  3. Frequently Asked Questions (FAQs)

Key Considerations for a Real Estate Purchase

When drafting a Real Estate Purchase Agreement, it’s important to ensure that both parties are protected and that all necessary conditions are outlined. Here are a few key considerations to keep in mind:

  • Disclosures: Certain disclosures, like lead-based paint for properties built before 1978, must be provided. In addition, sellers are required to disclose known property defects, though some states follow “buyer beware” laws, meaning the seller is not obligated to disclose all issues.

  • Addendums and Contingencies: Addendums add specific terms to the agreement, such as inspection contingencies or closing date extensions. These help ensure flexibility and protect both parties in case certain conditions aren’t met.

  • Earnest Money: This deposit shows the buyer’s commitment and is usually held in escrow. If conditions aren’t met, it may be returned, but without contingencies, the deposit may be forfeited if the buyer backs out.

  • Buyer Beware: In some states, like Alabama and Florida, sellers are not legally required to disclose property defects, leaving buyers responsible for inspecting the property and taking on the risk.

By considering these factors, you can create a solid and clear Real Estate Purchase Agreement that sets the right expectations and protects both parties.

How to Write a Real Estate Purchase Agreement?

Creating a Real Estate Purchase Agreement can feel like a big task, but it doesn’t have to be. If you’re unsure where to begin or how to structure the agreement, this 5-step breakdown will help you confidently fill in the necessary details.

1. Identify the Parties Involved

Start by listing the full names and addresses of both the buyer and the seller. Specify their legal status, such as whether they are an individual, corporation, LLC, or another entity. This ensures clarity about who is legally bound by the contract.

2. Define the Property Details

Clearly describe the property being sold. This includes the full address and the legal description (a formal, detailed description of the property). You should also outline any personal items (e.g., appliances, furniture) included in the sale, and note which items will not be included (like furniture or outdoor equipment).

3. Set the Purchase Price and Payment Terms

State the total agreed price for the property. Payment terms refer to how the buyer will pay for the property, such as via bank check, wire transfer, or certified check. In addition, earnest money is often paid upfront as a sign of good faith. Make sure to specify when the full balance will be due—this typically happens at the closing of the sale.

4. Include Contingencies and Disclosures

A contingency is a condition that must be met for the contract to remain valid. For example, a financing contingency means the buyer’s obligation to purchase the property is dependent on their ability to secure a loan. You should also include disclosures, such as known defects or hazards (e.g., lead paint in homes built before 1978). The seller must disclose any issues that might affect the property’s value or the buyer’s enjoyment of it.

5. Review and Finalize the Agreement

Once all terms are agreed upon, both parties sign the agreement, making it legally binding. Be sure to include any final details, like the closing date, how ownership will transfer, and any warranties or promises made by either party. At this stage, the agreement becomes enforceable, and both parties are expected to follow through on their commitments.

 

Frequently Asked Questions (FAQs)

01

A Real Estate Purchase Agreement typically expires if the closing doesn’t happen by the agreed date, though some contracts include a renewal clause to allow for extra time if needed. Once the agreement expires, neither the buyer nor the seller is legally bound to proceed with the sale, meaning the buyer loses the right to purchase the property. While the sale may not be completely over, the seller is not obligated to extend the closing date.

If delays push the agreement past its expiration, the buyer could lose their earnest money, or the seller could face legal action. That's why it’s important to set a clear expiration date and include contingencies to protect both parties.

02

A short-term rental agreement can still be considered legally binding even if it is not signed, but it’s much stronger and easier to enforce when both parties sign it.
A Real Estate Purchase Agreement is not recorded with the county or government office. It’s a private contract between the buyer and seller that outlines the sale terms. However, the deed is recorded after closing to make the ownership transfer public. The agreement itself doesn’t become part of the public record unless tied to the deed.

03

In some states, like Washington, buyers can waive the Form 17 Seller Disclosure Statement, which details the property's condition. If waived, the buyer accepts the property "as-is" without information on potential issues. However, this can expose the buyer to risks, so it's wise to consider a thorough inspection or consult a real estate professional before waiving the form.

04

A seller can cancel a Real Estate Purchase Agreement if the buyer fails to meet contingencies, like securing financing or completing inspections. If the buyer breaches the contract, the seller can also terminate the agreement. However, if the seller cancels without a valid reason, they could face legal consequences or owe damages to the buyer.

05

Not all Real Estate Purchase Agreements require a deposit, but it’s common practice. The deposit, called earnest money, shows the buyer is serious about the purchase. While it’s usually required, some sellers may agree to a sale without one, depending on the agreement or market conditions.