The critical documents used during FSBO housing transaction are the sales contract. Once the buyer comes with an acceptable price, both of you will then need to sign a FSBO sales contract agreeing to the offer.
You can purchase generic FSBO sales contracts from any major office supply store such as Office Depot, Office Max, or Staples. If you are taking the assistance of a real estate attorney, then he or she can also put together a FSBO sales contract for you. For making a successful real estate deal, it is essential for you to understand the sales contract.
The main purpose of the FSBO sales contract is to outline important pieces of information from the housing transaction.
The important pieces of information include:
- The property that is being sold
- The name of the buyer
- The name of the seller
- The amount the buyer will pay
- The date that the title and money will be exchanged
Initially, FSBO sales contract appears to be a complex document at first look. The document as a whole will make more sense if you are able to understand each every section of it.
First Section of FSBO Sales Contract
You will find legal description and physical address of your property in the first section of the FSBO sales contract. The legal description gives the country government a way to identify your property in the event of change of street address. Your property's legal description always remains the same.
Next Section of FSBO Sales Contract
The purchasing price and the way in which the buyer will be purchasing the home is mentioned in the next section of the FSBO sales contract. In most of the cases, the method used for payment is mortgage.
You can find the details such as amount of the down payment, earnest money deposit, and mortgage loan amount in this section. You can also the name of the escrow agent who will hold the earnest money deposit in this section.
Many of the pages in the FSBO sales contract are contingencies that essentially ask a sequence of what if questions. The buyer and seller can refer to the sales contract in the event that a contingency occurs to decide what action to be taken, if any.
Inspections
You can also find inspections that the buyer can request in the FSBO sales contract. In general, three clauses for inspections
- One is for general inspection
- One for roof inspection
- One for termite inspection
The clauses specify that the seller need to pay towards the repairs from his pocket if the home fails any inspection. The buyer and seller can also agree to the property being sold "as is." You can eliminate the need for inspections or repairs with this.
The closing date is documented in the FSBO sales contract. In general, the closing date will be between 30 to 45 days after the sales contract has been signed. The closing date can also be extended give you time to move.
You can the assistance of a real estate attorney for clarification, if you are unable to understand any part of the FSBO sales contract. Make sure that you understand the FSBO sales contract completely and also that you agree with terms before signing it.
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