How to Prepare a Real Estate Contract
Albert Wilson is the owner in fee of a parcel of improved real estate located at 1 Main Street, Middletown, USA. It is a single-family residence, located in an R-1 (residential 1 family house) zone, and served by city water and sewer. The house was built in 1944.
Robert Brown and Alice Brown, his wife, are entering into a contract to purchase the property. The sale price is $200,000. The Browns will tender $10,000 as down payment upon signing (earnest money) and pay an additional $10,000 within 20 days of contract signing. The couple is seeking a 30-year conventional mortgage of $180,000, at the current rate, which is 5.5%. An appraisal of the value of the real estate will be completed within 14 calendar days of the signing of the agreement. The loan will be obtained within 30 calendar days of the signing of the real estate contract.
What are the 5 essential elements of a contract in real estate?
The Browns have already sold their house and expect to close on or before Month Date, 20xx, which is 90 days from the anticipated date of the contract with Mr. Wilson.
The metes and bounds description of the real property is as follows: A parcel of land located at the NW corner of the intersection of Beck Road and Main Street in the township of Middletown, New Frontier County, USA and further described as commencing at the point of the beginning, then N 2 ° 0 ‘ 0” W – 110.50 feet, then N 88 °0’,0 “ E – 78 feet, then N 2 ° 0’ 0 ‘W – 63.50 feet, then S 82°0’0” E – 145.00 feet, then S 13°44’40” W – 185.83 feet, then N 82°0’0” W – 173.00 feet, to the point of beginning, and including 0.717 acres.
Writing a real estate purchase agreement
Assume that the property Mr. Wilson is selling to Mr. and Mrs. Brown has a rich vein of coal. Mr. Wilson intends to mine the coal for the next three years.
Prepare the real estate contract for the transaction between Albert Wilson and Robert Brown and Alice Brown, under which Mr. Wilson and Mr. and Mrs. Brown enter into a real estate contract as the seller and buyers, respectively.