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Contracts presentation

  1. 1. The 2014 Second Half Summit Contracts and Terms
  2. 2. Types of Sales -Purchase -Lease/Purchase -Rent to Buy -Cash -Seller Finance -Option to Purchase
  3. 3. Purchase -A seller conveys property to buyer through a deed -Uses a Purchase Agreement to determine specific expectations of all parties -Usually involves exchange of money through a mortgage or other asset -A binding contract is required and must be maintained throughout purchase period
  4. 4. Purchase -A seller conveys property to buyer through a deed -Uses a Purchase Agreement to determine specific expectations of all parties -Usually involves exchange of money through a mortgage or other asset -A binding contract is required and must be maintained throughout purchase period
  5. 5. Rent to Buy -Similar to a Lease/Purchase -A seller allows a purchase to Lease property with the intent to purchase -Determines a time to allow for buyer to close on sale ahead of time -Monthly rent must include non refundable portion being applied to the principle -No down payment required -Many times used while buyer re-establishes credit or decides if they want to buy specific property -Used for buyers that may not qualify for sales price and want to pay down principle before closing
  6. 6. Cash Sale -A seller conveys property to buyer through a deed -Uses a purchase agreement to determine buyer and seller expectations -Do not require lender approval to settle sale -No appraisal needed -Many times used by investors or swift buyers to avoid lender and industry regulations -Purchaser takes immediate Free and Clear Title to property at settlement -It is still encouraged to use a Title and Inspection process
  7. 7. Seller Finance -Can be called a dozen different names -Uses a purchase agreement to determine buyer and seller expectations -Financing Addendum attached to describe parties financial arrangment -Has a set settlement and closing -Seller must hold clear title or be able to do so under current loan(JH) -Transfer of Deed at time of closing but Seller retains a position as lien holder -A seller typically requires an industry standard down payment and interest rate throughout term -Has an end date or Balloon date that seller must be taken out of transaction
  8. 8. Option to Purchase -Not a Purchase Agreement or Sale -Typically but not always goes with a Lease agreement -Gives Option holder First Right of Refusal -May or May not take property off of the market -Holder has set amount of time to exercise Option and close sale but not required to purchase property -Option must be purchased and many times is non-refundable -Is used to protect buyer from losing property but no sale is required -Further negotiations are typically required for sale
  9. 9. Importance of Contracts -Based on negotiated facts -Relays party obligations and duties -Takes all assumptions and future conflicts to a minimum -It is our duty to understand and be familiar with contracts -The use of an experienced Attorney is suggested when using contracts and is well worth the small fee -A contract is enforceable by law -Saves you time and money if transactions are well spelled out
  10. 10. Purchase Agreement -Line by Line -Parties should be accurate throughout transaction -All lines and spaces should have data or n/a -Dates are most important to avoid default or loss of transaction -Creates duty and obligation between all parties which is then carried out as stated -A good Purchase Agreement is hard to contest legally -Should always be completed, signed and maintained as one(1) document forever -Most Realtors do not understand a full Purchase Agreement and knowing its meaning can help you stand out as a professional
  11. 11. Addendums -Should be used to remove contingencies and items of sale -Many times used for personal property in sale -Does not have to be a lender viewed document -Overrides all previous agreements by date and when signed -Similar to an Amendment Amendments -Used to make changes to the original purchase agreement as well and used throughout a transaction -Can only be made by parties that have signed the original agreement
  12. 12. Lender Contracts Fill in jon!

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