Most real estate agents use standard pre-printed purchase contract forms, filling in the details specific to your purchase terms. These legally binding documents are used to:
Set forth the terms of the sale.
Establish the rights and obligations of the parties involved.
Specify what actions will be taken in order to close the sale.
Establish time frames for those steps to be completed.
While most buyers are usually fully aware of terms regarding price, closing date, and financial arrangements, there is a tendency to overlook much of the rest of the contract. However, since all the contract terms will be binding, it is important to understand what you are agreeing to before signing the contract. Not doing so can be a costly mistake, especially if there are problems or difficulties in the transaction.
A purchase contract is created when there is a “meeting of the minds” on all terms—when you and the seller have come to an agreement and signed the offer form along with any counteroffers and addenda. Real estate contracts must be in writing; verbal contracts to purchase real estate cannot be enforced.