How Do You Create a Home Purchase Agreement?


Quick Answer

Every home purchase agreement should contain the purchase price, amount of down payment, effective dates of the offer, closing and move-in dates, a legal description of the property and other items in the sale, a guarantee of a clear title, and an inspection clause that also allows for a walk-through inspection before closing. A clause making the purchase contingent on the sale of the previous house is added if needed.

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Full Answer

In a home-purchase contract, the potential buyer making the offer may also include clear responsibilities for all house-related expenses up to the closing date, a clause requiring the return of the deposit if the sale is not closed due to trouble obtaining financing, and a mortgage-contingency provision, which allows the buyer release from the contract if unable to obtain a loan at a specific interest rate within 30 to 60 days. Once the buyer sends an offer with a contract, the seller may counter and accept certain terms, but propose changes or new terms. The counteroffer may include a higher purchase price, a decrease in time for contingencies, exclusion of certain items in the sale, such as furniture or fixtures, or a contingency clause on attorney approval. All buyers and sellers have the right to negotiate terms until they are agreeable to both parties.

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