The Purchase Contract Principles

1. During the negotiation process, the seller and buyer will agree to the sales price, and sales terms.  

2.  The buyer must tell the seller what type of financing will be used.  The reason being that different financing options will affect the closing costs, the time frame for closing, and contract details. Some of the different financing options are as follows, but not limited to;

     A. Cash
     B. Mortgage Loan
          1. Conventional Loan Type
          2. FHA, or VA insured loan

3. The buyer and seller decide who will pay what closing costs.  The buyer may ask for help with closing costs.  Below are common closing costs.

     A. Title insurance
     B. Loan associated costs,
          1. Loan Origination fee
          2. Processing fees
     C. State Transfer Tax
     D. HOA Transfer Fees
     E.  Real estate broker fee
     F.  Recording fees, fees for wiring, processing, etc.
     G. Prepaid escrow impounds as required by mortgage lender

4. Buyer, and seller should agree on a close of escrow date.

      A. Typically, this will be the amount of time the lender needs to finalize the loan.
      B.  A typical close of escrow is 30 to 45 days, from the contract date.
      C.  Usually, close escrow is towards the end of the month. But, the seller may agree to close anytime during the month, as it is convenient for them.

5. Once these major negotiation points are agreed upon, the due diligence period begins. 

 

      A. The due diligence period is typically 10 days. But, the buyer, and seller may agree on how ever many days, they chose. 

     B. The due diligence period is the time frame for the buyer to investigate the condition of the home. This is the time to order home inspections, and ask for repairs.
     C. This is the time to research factors that are important to to the buyer. For example, verify the schools, transportation, and other lifestyle factors.
      D. The due diligence period is the legal time frame that the buyer has to rescind the offer,  without penalty.

6. By Nevada State Law NRS. Chapter 113, the seller must provide disclosures to the buyer. The seller must provide disclosures that describe the condition of the property.  (You may retrieve booklet describing Disclosures here).  This is the seller's responsibility, during the due diligence period. 

 

         A. The seller must provide a Seller's Real Property Report.

         B. The seller must order immediately CCR's for the buyer to review.