Introduction
Are you buying or selling real estate in Florida? If so, all the terms of deal will be set forth in a written contract governed by Florida law. Buyers and sellers have the ability to use a contract that has been pre-approved by the Florida Association of Realtors® and the Florida Bar Association. In fact such contract is used in almost all transactions. In most cases you will use a Realtor® to help you with the sale or purchase of the property. Nonetheless only attorneys can give you legal advice regarding the contract.
Elements of a proper Real Estate Contract
1) Contract must be in writing.
All the essential terms of the contract must be in writing so to reduce vagueness and any potential misunderstanding of the contracts. In addition, this is required to satisfy what is known as the "Statute of Frauds" that sets forth requirements for some types of contracts to be enforceable.
2) Names & Signatures of all Parties.
All the parties of the contract must be listed and sign the contract. If you own a house as a husband and wife then both of you must sign the contract in order to sell your property. Neither husband nor wife can compel the other party to sell the property.
3) Description of the Property.
The description of the property must be sufficient to identify the property being purchased. The best way to do that is to put down the legal description of the property which would be listed in the deed of the property or the county’s appraisal website. Mailing address may not be enough to sufficient describe the property because of the location of fences or natural boundaries. That can create confusion regarding the location of the actual property.
4) Purchase Price.
The contract for real estate requires that you input the offered purchase price of the real estate.
5) Earnest Deposit.
In order for the seller to hold the property for you and not sell it to another party, you must provide him with an earnest deposit depending on the purchase price.
6) Agreement to Buy and Sell.
To be enforceable, contracts must include language stating that the buyer intends to buy and the seller intends to unequivocally sell the property. Additionally, most contracts come with certain contingencies that will have to occur in order to close on the property. The most common one is the financing contingency, which you will need to include if you plan on getting a loan from the bank to buy the property. In most cases, if you are unable to close on the property because of lack of financing then you can walk out of the closing and get your earnest deposit back.
7) Closing Date.
Finally, to enforce a real estate contract, a closing date stating when the property will be transferred to the new owner must be clearly stated. Depending on the type of financing, it typically takes 30 days from when the contract is signed to close on the property.
Conclusion
While these are the basics, there is certainly more to any real estate transaction than what is mentioned above. If you'd like a first or second Legal opinion about your real estate transaction, or you have questions regarding this post, please do not hesitate to Contact Us. We are happy to help!
Originally written by: Ness Chakir, Esq. of CPC Law in Orlando, FL