How to Write a Purchase Agreement

How to Write a Purchase Agreement
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Tip

Avoid the temptation to allow small items tie up your home sale. For example, if the buyer absolutely wants a table that's in the home, just give him the table (assuming it doesn't have a very significant sentimental value). Agree on an additional price, build it into the purchase agreement and sign the paperwork. If you don't want certain items to be up for grabs, don't keep them in the home when it is being shown to prospective buyers.

When you're in the process of buying or selling a house, you have to write up a purchase agreement at some point. It is an official understanding between buyer and seller about the purchase price and negotiating points (like what furniture will remain in the house). This is usually taken care of by your real estate agent, but this is something you will be responsible for if you are selling or buying a house on your own. The agreement needs to be thorough and complete or else issues may arise during the transaction.

Step 1

Begin the agreement by writing in the full name and address of both the seller and buyer. On a separate line write in the full address of the property that is being sold and a short description (such as single-family home).

Step 2

Write in the selling price agreed upon between the seller and the buyer. If the price can be changed or modified by either party, be sure to include a clause that states so and the deadline by which the change must be finalized.

Step 3

Require the seller to do a title search to prove that there are no liens on the house. Also include a section describing what type of deed the seller will convey to you (for example, standard warranty, special warranty or quitclaim deed). See "Resources" for more information on the different types of deeds.

Step 4

Include a discussion of the amount of seller's assist that the seller will provide to the buyer (if applicable). Seller's assist is a percentage of the home sale that is built into the loan and provided to the buyer as cash to help with closing costs.

Step 5

Enter the amount of the deposit that the buyer will be placing with the agreement. This is usually about $700 to $2,000 or more depending on the price of the home. Include information about whether the deposit is refundable or not (it is usually not).

Step 6

Write in the desired closing date—again this date has to be agreed upon by both parties. Include information about when and under what circumstances the closing date can be changed.

Step 7

List the items that are going to remain in the house (such as refrigerator, stove, any other appliances and furniture). Also include details about everything that must be removed from the home, such as old air conditioners in windows.

Step 8

List repairs that must be made to the house for the sale to be complete and valid. Clarify that the house must be cleared and swept clean before the closing date.

Step 9

Be sure to include information about any contingencies for the sale in your purchase agreement. For example, the agreement will be executed contingent on a home inspection that results in a good report.

Step 10

Have both parties sign and date the agreement in the presence of a notary.

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