Terms That Should Be Included in a Real Estate Contract
1. Buyer may terminate the contract for any reason or no reason, in Buyer’s sole discretion, whether questionably reasonable or not.
2. Upon termination all earnest money shall be released to Buyer immediately.
3. If there is evidence of termites, Buyer may terminate this agreement and earnest money will be released to Buyer immediately.
4. If the premises are not in substantially the same condition as of the date the Buyer signs the contract, Buyer will have the right to terminate the agreement and all earnest money will be released immediately to Buyer.
5. If the Seller breaches the agreement, Buyer has a right to specific performance.
6. Seller should deliver to Buyer copies of all documents and information Seller has in its possession including, but not limited to, surveys, building plans, building permits, contracts for the construction and operation of the premises, notices from governments or insurance companies of bills or summary reports reflecting utility bills, pest control and extermination services, inspection reports, and copies of any litigation involving the premises.
7. Buyer’s time for review of the title commitment should begin seven days after Buyer’s receipt of all recorded documents and an ALTA (American Land Title Association) survey.
8. There will be an MAI (Member Appraisal Institute) appraisal of the premises and if that appraisal is in an amount less than the purchase price, the Buyer will have the right to terminate the agreement and all earnest money will be released immediately to Buyer.
9. Seller warranties that:
- There are no claims, actions, suits, or other proceedings (including condemnation) pending or threatened that may detrimentally affect Buyer’s right, title, or interest in the Premises or the value of the Premises or Seller’s ability to perform Seller’s obligations under this Agreement.
- Seller has complete title to the Premises subject only to the matters reflected in the preliminary title report.
- No work has been performed or materials furnished which might give rise to mechanic’s liens.
- Seller is not prohibited from consummating the transactions.
- There are no parties in adverse possession; there are no parties in possession except Seller and no party has been granted any license, lease, or other right.
- There are no attachments, executions, assignments for the benefit of creditors, receiverships, conservatorship, or voluntary or involuntary proceedings in bankruptcy.
- There is no default, nor has any event occurred which, would constitute a default in any contract, mortgage, deed of trust, lease, or other instrument.
- There are no contracts or other obligations for the sale, exchange, or transfer of the property.
- Seller has no knowledge of any violations of law, rules, regulations, ordinances, codes, covenants, conditions, restrictions, or agreements. Seller has not received notice of a violation from any insurance company or governmental agency. If any notices of violations are received prior to Close of Escrow, Buyer may terminate agreement.
10. Seller is not aware of any radon gas contamination.
11. Seller has no knowledge of any sites of historical or archaeological importance.
12. Seller will not at any time prior to or after Close of Escrow grant to any person an interest in the Premises.
13. The Property has the appropriate zoning designation, and Seller will not join in, consent to, request, or apply for any change unless Buyer approves.
14. Seller expressly warrants that the Property has access to and from a public street.
10. Neither Seller nor any other person, to the best of Seller’s knowledge, has ever caused or permitted any Hazardous Material to be placed, held, located, or disposed of on, under, or at the Premises or any part thereof, nor has any part of the Premises ever been used as a treatment, storage, or disposal site for any Hazardous Material.
11. Seller indemnifies Buyer and agrees to pay, defend, and hold Buyer harmless from all losses, liabilities, incurred with respect to the presence of any Hazardous Material.
12. Seller warranties and representations shall survive Close of Escrow.
13. Seller does indemnify and hold Buyer harmless from any liability, arising from any act or omission of Seller pertaining in any manner to the Premises for the period of time prior to Close of Escrow.