Ever wonder which terms and conditions are related to real estate transactions?
A key piece of closing a real estate deal is a purchase and sale agreement, also known as a Purchase and Sale Agreement, P&S Agreement, or PSA.
Below we have outlined the different terms of the sales contract.
What Is a Purchase and Sale Agreement?
It defines what requirements the buyer and seller must meet including purchase price, limitations and contingencies.
Real estate agents generally write these contracts for the buyer and seller to sign. Ideally, the parties lawyers have an opportunity to review the terms before signing, but this is often not the case in the majority of transactions in Ontario. These contracts may also be prepared by the parties’ lawyers in a private sale arrangement.
How Purchase and Sale Agreements Work
With a purchase and sale agreement you are determining how to handle:
- Title searches and transferability
- Inspections and negotiations
- Financing and loan documents
- Transfer of money
- Closing and associated costs
What Is In a Purchase and Sale Agreement?
Some of the elements included in a purchase and sale agreement are as follows:
- Amount of the deposit and handling of cancellations
- Personal property included in the transaction
- Escrow and occupancy dates if applicable
- Contract default provisions if one or both parties do not meet the agreement
- Property inspection terms and conditions
- Financing arrangements and stipulations for payment of closing costs
- Contingencies for the sale or purchase of a new or old residence and insurance, including a rental lease agreement or forbearance agreement
- Other covenants, limitations and conditions as necessary
Why are Purchase and Sale Agreements Important?
As a buyer, the purchase and sale agreement is the most important document you have to put together.
This is because it outlines what you are entitled to and without it, you may lose rights.
Conclusion
Thinking about buying a house and in need of a lawyer to finish the deal?
Feel free to call our office today to book a free 30-minute consultation.
This blog is made available by the law firm publisher, Epstein & Associates, for educational purposes. It provides general information and a general understanding of the law but does not provide specific legal advice. Any specific questions about your legal concerns please contact us now and speak to an expert today.