Real Estate Purchase Contract - Important Terms and Conditions to include

When making a formal purchase offer on a home you will want to include these following important terms and conditions:

Finance Terms
If you are like most buyers, you will need to obtain a mortgage loan to purchase your home. Therefore, your purchase offer should state that your offer is contingent upon you obtaining financing at a specified interest rate that you can qualify.
 
If you need to obtain other type of financing such: FHA or VA, instead of a standard Conventional loan, you should also specify this in your contract. Furthermore, if you will be paying all cash for the home then you should state this as well because this make your offer more a lot more attractive to seller.
 
Seller contribution towards buyer’s closing costs
If you would like to have the seller to pay a portion or all of your closing costs, you must request this in your offer. Your offer should state the closing costs you are requesting; either as a dollar amount (example: $6,000) or as a percentage of the home's purchase price (example: 3%).

Allocation of closing costs
There are several typical fees/costs associated with a purchase transaction such as: escrow, title search, title insurance, notary, recording, city and county transfer taxes, etc. Therefore, the purchase agreement should specify who will pay certain fees (buyer or seller). Your real estate agent can advise you as to whether it is the buyer or seller who customarily pays each of these fees.

Physical home inspection contingency
Unless you are buying a tear-down home, you should include a home inspection contingency clause in your offer. This clause allows you to cancel the transaction if a home inspection reveals significant flaws, safety issues and expensive repairs that need to be made to the home.
 
Fixtures and Appliances
If you would like certain fixtures and appliances to be included with the home such as: refrigerator, dishwasher, stove, oven, washer, dryer, custom light fixture, etc. you should include them in your purchase contract and not rely on a verbal agreement.

Closing Date
This is the time you need to complete the purchase transaction. Common time frames are 30, 45 and 60 days depending on the on various things. Some of the issues that can affect this time frame might include things such as: seller's need to find a replacement home; the remaining term on your lease if you are currently renting; the amount of time you have to relocate if you are moving for a job transfer, etc.

Sale of Existing Home
If you are an existing homeowner and you need to sell your current home in order to have the funds necessary for your new home purchase, you should make your purchase offer contingent upon the sale of your current home. You should also provide a reasonable time frame for you to sell your home, like 60 days. However, the seller of the property that you are interested in is not going to want to take his/her property off the market indefinitely while you search for someone to buy your home.

There are many other terms conditions that are part of the entire a real estate purchase contract and it’s important that you go over every detail with your agent before finalizing your offer to present to the seller.