Lynn B. Friedman - Atlanta Homes ODAT Realty: What does the contract say?

What does the contract say?

Dear Readers -

In this post, Barry Owen from Nashville, TN, focuses our attention on a very important details of our work - the contract! He carefully details why the contract is so important and why EVERYONE needs to read it carefully. He reminds all of us ---
"Understand what you’re signing BEFORE you sign it!"

 

Barry shares important information. You will learn a lot by reading Barry Owen 's other posts as well - Going to Make an Offer, Zillow Values, and, his comments about TRID, which came into effect in October 2015.  

 Have a successful day -
Lynn

PS -- If I haven't thanked you personally for following my writings, please accept my gratitude now. Your views and comments mean a lot to me.  L.

 

 

 

The TAR Purchase and Sale Agreement is 10 pages LOOOONG!

THAT’s a LOT of words and terms and blanks and dashes and time deadlines and STUFF.

Some folks believe 10 pages is too many pages and that we should trim it down to 2 or 3 pages like the good old days when a handshake really meant something.

The truth is that all of those words ARE “unnecessarily TOO much” for most transactions, and the folks who created this 10 page document know this . . . yet they also know that most of those words are there for the protection of all parties in the event that something goes wonky and gets fuzzy . . . Better to have the mechanisms in place to deal with sticky situations just in case.

A preemptive strike!

If it’s not spelled out up front, how do we make it through the fog of murkiness that often shows up mid-transaction?

If all we did was write: “I agree to pay Joe $347,000 for 123 Main Street, and we agree to close in 45 days or sooner if I can get the money in order sooner.” . . . that might work in some cases.

Until . . . I notice there’s some deteriorated wood on most of the exterior window sills, a veritable babbling creek running through the crawl space, and the Air conditioner is blowing HOT air. Then a train rolls through the back yard (tracks hidden by Landscaping).

And I wake up and smell the coffee with the realization that this house is really not worth the  $347,000 I promised to pay – It’s more like $275,000.

Rut-Roh!

Now what?

Where’s the language that helps us make our way through THIS quagmire?

What if I lose my job 10 days before the closing date . . . and without a job, I can’t possibly pay the mortgage . . . but I promised Joe I’d buy the place . . . so . . . how do I get out of this contract?

So this is the contract we have. All those words are for NAUGHT – NIL – USELESS unless the following statements ring true:

  • The REALTOR understands the contract and how it works and has a system to be able to guide her client through the transaction paying close attention to adhering to all of the dead-lines and executing the appropriate paperwork in a timely fashion with ALL required signatures.
  • The client takes whatever time necessary to understand the terms, conditions, and timelines set forth in all documents and asks said REALTOR every question that comes to mind such that he knows what he has agreed to do by signing and his role in the transaction . . . and then with diligence and good faith works with the REALTOR to move towards closing ON TIME!

As Principal Broker of Pareto Realty, I do a LOT of coaching and training with ALL of our “Vital Few” Real Estate Sales professionals so as to ensure that our Home Buyer and Seller clients understand the documents they are signing, their roles in the process, and the requirements as set forth in the contract.

Occasionally, there’s a train wreck which is mostly to do with lack of effective communication and/or understanding of some parties to the transaction.

The good news is that, in many of these cases, the Buyer wants to buy the house, and the seller wants to sell the house, so we are able to unravel the bowl of spaghetti and find our way together to the closing table . . . If not, we call it what it is (a dead horse) and agree to cease collectively beating it.

I write this post after coaching an agent through a messy Inspection resolution in which there was not a single time constraint that was properly met by the appropriate paperwork . . . So . . . By the time I was brought into the loop . . . Not only had the Buyer lose all rights per the inspection contingency, but also the deal was automatically terminated by all parties failing to reach resolution by the end of the period. YUCK!

End result?

Dead Deal – House back on market – Buyer looking for another house!

DON”T let this be you!

Understand what you’re signing BEFORE you sign it!

The only thing scary about buying and/or selling a house is lack of knowledge and poor communication . . . Hmmm . . . that seems to ring true for everything we do, doesn’t it?

I think 10 pages is just about right :-)

About 

Residential Real Estate Principal Broker and Founder of Pareto Realty, LLC. Creating the quintessential real estate firm with emphasis on "Live, Work, & Play" balance . . . and a true Performance Oriented environment for Real Estate Professionals. Serving the Real estate needs of Home Buyers and Sellers in Middle Tennessee.

Barry Owen

Founder
Principal Broker
Pareto Realty
Nashville, TN

615.502.2080
www.paretorealty.co  
Call me: 615-568-2123
email me: barryo@comcast.net

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Comment balloon 2 commentsLynn B. Friedman • April 13 2016 10:03PM

Comments

This is a good post to reblog. I missed reading it the first time.

Posted by Gita Bantwal, REALTOR,ABR,CRS,SRES,GRI - Bucks County & Philadel (RE/MAX Centre Realtors) over 2 years ago

THANK YOU for the very nice generous share of my blog post(s) Lynn B. Friedman

Posted by Barry Owen (Pareto Realty) over 2 years ago

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