A good real estate contract is one that helps to protect both the buyer as well as the real estate broker. In a typical scenario, the broker will only have a standard contract that will contain clauses that lean towards the broker and you, the buyer. Here are a few essentials that you must look for in a real estate contract:
“And/or assigns” or “and/or Nominees” – Replace the “and/or assigns” with your name to have the right to assign your contract. The words, “and/or nominees” gives the right to place title of the property in the name of a trust. In case you see an “anti-assignment” provision, remember to cross out the clause.
Inspection Clause – Ascertain the right to inspect the property before a specific date. Make sure that you do not have to hire a professional inspector. This clause should also permit you to cancel out the agreement if you find that the inspection clause permits you to cancel the contract when you find something wrong. In most cases, this occurs when the seller is not willing to fix or come down on the price.
Right to Extend – If a buyer is not willing to close out, the seller has a provision to default the buyer. Most contracts would have a certain date for closing and if you want to buy extra time, specify the closing date with “on or about” words. It is your right to extend the closing date if you have proper reasons to do so.
Choice of Escrow Company – Choosing a title or Escrow Company will always let you have control as a buyer.