THE CONTRACT PROCESS
W R I T I N G T H E C O N T R ACT The process of buying or selling real property is a complex transaction involving numerous parties and commonly, conflicting interests. To reduce the possibility of misunderstanding or miscommunication between these parties, all negotiations regarding the purchase or sale of real estate should ultimately be reduced to a written agreement. This agreement when signed by all parties should represent the entirety of the agreement between buyer, seller and any other party materially involved in transaction. The section below describes important areas of the written agreement which ultimately forms a contract between the two parties. It is very important that you read and UNDERSTAND the entire agreement prior to signing it. Your professional real estate agent or attorney can be invaluable in helping you to understand the important details contained in this document. Purchase and Sale Agreement. The document that creates a valid enforceable contract between a buyer and seller in Georgia is called a Purchase and Sale Agreement. This contract has been created and pre-approved by attorneys and the Georgia Association of REALTORS® (GAR) and includes but is not limited to terms related to the legal description of the property, purchase price, method of payment, buyer’s earnest money, closing date and possession, inspection, and agency. No longer is there a finance contingency included in the Purchase and Sale Agreement. If a buyer needs a finance contingency it must be stipulated by way of an attached exhibit stating the terms of the loan. Otherwise, the contact states only that the buyer is paying cash. Offer and Counter Offer. The process of creating a purchase and sale agreement involves negotiation and may require several iterations to finally arrive at a complete agreement between the parties. Each time a party initiates, changes or adds to a purchase and sales agreement, an offer or counter offer is created. The buyer or buyer’s agent presents offers to the sellers agent, the sellers agent in turn presents the offer to the seller. The seller may accept the offer as is or make a “counter offer.” Any changes to the offer, automatically resets the time limits and voids the original offer once received by the original offering party. It is important while negotiating a purchase or sale to remain aware of the time limits each party allows for response. Time is of the essence in real estate agreements and if you miss a deadline, you may miss an opportunity, or worse, be committed to something you didn’t want.
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