Price plays the starring role of most home sales while terms and conditions are often considered the supporting cast. In reality, the terms and conditions of a real estate transaction will determine whether your home sale is a hit or not.
Every home listed for sale has one major thing in common. It has an asking price. In many cases, the success or failure of the sale is relegated to finding a buyer who will pay the asking, or listed, price. It is obvious that price is important but what about the terms and conditions of the sale?
It is interesting to note that in Pennsylvania, the STANDARD AGREEMENT FOR THE SALE OF REAL ESTATE reserves one line of its 13 pages to price and the remainder to terms and conditions. Certainly it is obvious why this is the case, but it does help make my point. Without terms and conditions that are clearly understood and responsibly met by all parties in a real estate transaction, there will be No sale price because there will be No sale. I would further state that reasonable ~ (and I use the word loosely) terms and conditions are the keys to a happy and smooth real estate transaction.
Top selling price is nice, but it is the orchestration of a well-planned real estate deal that brings many positive accolades. No one likes a tough deal where the buyer and seller are scratching for every inch of turf. It creates ill will and makes the real estate professionals look, well, not professional. Furthermore, what good does it do if the price you get or pay is eroded or impacted by costs that could have been alleviated using beneficial terms and conditions?
Certain terms and conditions like the settlement date are very standard, but there may be more to consider. If you are a buyer, you may want to consider moving things into the home before settlement. The pre-settlement possession addendum would work nicely here. The seller may desire to move out of their home sometime after settlement. The standard document used in this case is the post-settlement possession addendum.
Another often used condition of sale is the home inspection contingency. This contingency gives the buyer the right to have home inspectors investigate the property to make sure it is to the satisfaction of the buyer. If it is acceptable to the buyer, the transaction continues. If it is not acceptable, the buyer can terminate the agreement. There is a third option the buyer can consider which involves renegotiating or requesting that the seller repair, replace or credit the buyer an amount of money that will make the home acceptable to the buyer. While these choices are a fundamental part of our agreement, it is my opinion it often kicks the deal can down the road and opens the door to unwanted renegotiation. There are times this type of renegotiation is necessary, but occasionally these things can be handled differently. The terms of any reparations, if necessary, and the costs thereof can be discussed and agreed to up front.
The point is a simple one. There are as many considerations in a real estate transaction as there are stars in the sky. Our standard agreement is a good start. A well-versed real estate agent can supply both the buyer and seller with valuable options that stretch above and beyond the status quo.
There are no two properties alike and no two people that are the same. Every real estate transaction is unique unto itself. The success of your transaction could easily rest on the experience of your Realtor® and the planning of your terms and conditions.
Knowledge is Power!
Jeffrey C. Hogue
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