Purchase and sale agreements (PSAs), or sale and purchase agreements (SPAs), are found in a variety of different business deals, but are most commonly referenced when talking about real estate transactions. To be sure, if you are about to buy or sell a home, you will no doubt enter a purchase and sale agreement. At Simple Title Closing & Escrow PLLC, our legal professionals can help you to understand the basics of a purchase and sale agreement, as well as review an agreement to ensure it is legally sound. Please contact us today to learn more.
Purchase and Sale Agreement – What’s That?
A purchase and sale agreement is a contract between the seller of the property and the buyer, and is initiated before the transaction is complete, but after the buyer has submitted an offer to purchase. There are a number of issues that are addressed within a purchase and sale agreement, including:
- The names of the parties;
- A description of the property;
- The agreed sale/purchase price;
- Real estate taxes;
- The closing date;
- Which items will be included or excluded (i.e. refrigerator, washer dryer, lighting fixtures, etc.);
- Required disclosures (in Massachusetts, sellers are required to disclose the presence of lead paint);
- How the transfer of the title and deed will occur; and
- The responsibilities of the seller, which might include performing upkeep on the property, paying commissions, holding earnest money in an escrow account, and more.
A purchase and sale agreement also outlines any contingencies that might allow a buyer or a seller to back out of the contract without consequence. For example, a contingency might be that the buyer is allowed to back out if the property appraises for way less than what the seller is asking, as this could affect their ability to obtain a mortgage loan. Or, another contingency is that in the event that the buyer is unable to secure financing, despite good faith efforts to do so, they are allowed to back out of the deal without being liable for damages to the seller.
Why a Purchase and Sale Agreement Should Be Reviewed By an Attorney
You should never enter a purchase and sale agreement without first having the agreement reviewed by an experienced legal professional. A good attorney will know that a purchase and sale agreement should contain language that protects the buyer from property defects, a rate lock if the closing date is changed, and a cap on damages should the buyer default, amongst other things.
Contact Simple Title Closing & Escrow PLLC Today
At Simple Title Closing & Escrow PLLC, the standard purchase and sale agreement is not always sufficient for protecting a buyer’s or seller’s interests. We go beyond the standard form to amend purchase and sale agreements so that they are fair and protect your time, money, and agenda. Our attorneys are highly skilled in residential and commercial real estate transactions, and have the legal acumen, knowledge, and experience you’re looking for. For a consultation regarding a purchase and sale agreement or another element of the real estate transaction process, please contact us online or by phone today.