Basic Overview of Real Estate Legal Contracts
In this post, we will be outlining descriptions of various legal agreements you'll encounter as a prospective homeowner.
Agreement of Purchase and Sale
A Contract of Purchase and Sale is a written agreement between a seller and a buyer for the purchase and sale of a particular property. The buyer agrees to purchase the property for a certain price, provided that a number of terms and conditions are satisfied.
Some of these terms and conditions include the time frame in which the offer is valid, the subject-removal date (how much time the buyer has to examine the property), and the completion date (paperwork is examined and sale is finalized).
BRA (Buyer Representation Agreement)
The agreement outlines the exact services the real estate broker will provide, in what time frame, and how much compensation he/she will receive.
While BRAs protect real estate agents by ensuring they will be compensated for their work, there are important advantages to home buyers too.
The agreement brings structure, time limit, and clarity to the complex
1. There are benefits to signing a BRA for home buyers
A home is a huge financial and emotional purchase, and a BRA helps bring some much-needed clarity and formality to the process.
By a signing a BRA, you can outline all your wants and needs for a property (legally on paper), clearly outlining all the services your realtor is obliged to deliver and remove any possible concerns around how commissions will be paid out.
3. You don't have to buy a home even if you signed a BRA
BRAs have an expiry date and you can negotiate with your realtor the extent of the contract period.
Also, you're not required to buy a home during the BRA period, so if you negotiated a one-month contract with your agent, don't worry, you won't actually have to put an offer on a home during that time. A BRA can expire without you ever buying a home.
Conveyance is the act of transferring an ownership interest in a property from one party to another. Conveyance also refers to the written instrument, such as a deed or lease, that transfers legal title of a property from the seller to the buyer.
Conveyancing ensures that the buyer is informed in advance of any restrictions on the property, such as mortgages and liens, and assures the buyer of clean title to the property.
Conveyance vs deed
Conveyance is a general term that applies in a legal sense beyond residential real estate. The conveyance in most real estate transactions is also known as the sale deed. Conveyance is the category, and sales deed is a type of conveyance within that category.
POA to buy/sell real estate
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Note: these blog posts are written by a communications professional and are not intended to be legal advice. One of our lawyers would be glad to help if you have a specific issue in mind.