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Ah, yes… contracts. The word that can make any faith-filled people-person suddenly question all humanity. What is it about the “sign here, please” command that makes us cringe? Could it be because there is just too much we DON’T know about the fine print and fancy language that we’re hesitant to committing?
I’d say that’s pretty likely… and for good reason!
What most sellers don’t know is that there are actually several pieces of a real estate contract designed to not only protect, but potentially benefit you.
Yup. You heard me right. With so much on the line in this current market, you have to be working with one of the best realtors. Only the best listing agents can provide everything you deserve in the understanding and executing of your contract.
In the event that you end up with a less-than-the-best agent who just happens to work for one of the top Real Estate Offices (no, they are NOT one in the same!), it wouldn’t hurt to know a few things.
Which is why we are writing this series of blog posts: Real Estate Contracts: What Do You Need to Know? We want to bring insider knowledge to the average homeowner. With years of industry experience, we’ve learned a thing or two about the fine print and hidden benefits of Real Estate contracts.
Today will be an extremely BROAD overview of things we’ll be revealing secrets about later on. Read on, and stay tuned! ……
In Florida, there are two types of contracts used in a residential transaction. You’ll either see a Standard Contract or an As-Is Contract. The difference between those two could cost you (or potentially MAKE you) thousands of dollars. In our next post, we’ll break down the differences between them so you’re empowered to make a decision on what type to accept when listing your home.
Both types of contracts cover basic terms of all transactions:
Earnest money is known as a “good faith deposit.” This money is typically deposited by the buyers within the first three days of the executed contract. I usually see 1-2% of the purchase price, but it can vary greatly. It goes into an escrow account monitored by the title company or lawyer.
Inspection Time Period is the amount of time the buyer can perform inspections on every aspect of the home to assure it matches their expectations. It’s also the time where you might be asked to pay for something extra or deviate from the original agreed upon price. Standard in Florida is 15 days, unless otherwise written.
Loan Commitment Deadline is when the buyers need to have the “all clear” from their loan company. It states they are fully qualified and ready to pay for the home. Florida tends to be 30 days from executed contract, but would obviously be different if they offer a 28-day closing period. (Of course, I’ve actually had agents leave the standard 30-day loan commitment deadline on a 28-day closing. Smh.) Remember, this does not apply to cash buyers.
Closing Date is the finish line! In Florida, buyers take possession of the home ON the closing date. Make sure you don’t stay up late packing the night before and pass out in a sleeping bag! The buyers will find you during their day-of walk-through (Yup. That has actually happened to my client. Stick with me.. I’ll have plenty of fun stories to tell.)
If you are using one of the best listing agents who knows their real estate contracts, then you don’t need much more.
If you’re not, hang with me and I’ll show you the ropes.
Just remember, I’m a Real Estate Broker, not a lawyer. This is not to be taken as legal advice. If you need some of that, I’ve got a great guy who can take you where ya need to go! Shoot us an email at FloridaGrownHomes@gmail.com and we’ll get you connected!