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Everything you need to know before signing a contract

Updated: Mar 27, 2020

What is the purchase agreement? It is a written agreement between buyer and seller. The buyer agrees to pay and the seller agrees to give the deed to the property.

The contract includes:

• Price, sales/closing date, offer expiration date, earnest money deposit amount

• This also clarifies who pays for inspections, survey, title insurance, property taxes, etc.

• Contingencies give buyers a chance to back out of the purchase. The three contingency terms are inspection, appraisal, and loan.

It’s important to review a contract thoroughly. If anything is unclear, ask your agent.

How the contract works

If the seller accepts, the offer becomes a binding agreement. If rejected, the seller can counter the offer. Both parties can counter as many times as they want until they sign a mutual agreement or one party stops responding.

How long does it take to close on a house?

Generally in Bay Area we have somewhere between a 21-30 day escrow period.

How to get out of a real estate contract?

Changing your mind after signing the contract could result in the loss of your earnest money. This is 3% of the purchase price.

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