NCAA Football

The heart of the deal: Knowing what’s in your contract

September 16, 2017

Most people enjoy shopping for homes. Even people who aren’t looking for a home enjoy shopping for homes.

They’re called Looky Loo’s and Looky Louises, and I meet them every weekend at my open houses.

Suffice it to say that shopping for a home is about the only fun part of the home buying process. Because once you make the decision to submit an offer to purchase a house, you’re now dealing with a contract, and there’s really nothing fun about contracts.

Take for instance the first page of the 10 page Residential Purchase Agreement. On this page alone you are committing to some very specific terms – the price you are offering, when you want to close escrow, the amount of your initial deposit, the amount of your down payment, and the amount of your loan being the most significant.

In addition to the close of escrow date, you are also committing to getting your initial deposit into escrow within three days of acceptance. The date of acceptance – that is, the date the buyer or seller accepts the other’s offer without making a counter offer — is a big deal in a real estate transaction, as it is the date that determines all of the other dates in the contract.

The contract also stipulates the initial deposit shall be wire transferred to escrow within three business days after acceptance. So if the date of acceptance falls on a Tuesday, you have until Friday to get your deposit wired into escrow.

Failure to do so gives the seller the right to cancel the contract. Unless one of the days between Tuesday and Friday is a legal holiday, then you get an extra day. But if that were the case, your deposit would then be due on Saturday, and since you get a pass for weekend days as well, your deposit would not legally be due until the following Monday.
Your best bet is to get to your bank the minute you receive the wiring instruction from escrow and get ’er done.

And just because you’ve reconsidered and no longer want to hand over the huge deposit you wrote in the space provided on page one of the purchase agreement, and you’d now prefer to wire in a lesser amount, you technically cannot, without running the risk of the seller cancelling the contract.

You should submit an Addendum to the Purchase Contract to reduce the deposit amount, if that is your desire and you want to avoid having the seller cancel your contract at all costs.
Now, that’s not to suggest that the seller will agree to a reduction in the initial deposit. It’s a contract after all, and as such, cannot be changed unilaterally.

Contributing columnist Leslie Sargent Eskildsen is an agent with Realty One Group. She can be reached at 949-678-3373 or @leslieeskildsen.

Read Full Article