One of InnovaCounsel’s many legal services deals with purchase and sales agreements. These contracts are generally used for transactions involving real estate and business assets. With purchase and sales agreements, certain conditions must first be met in order for the sale to be finalized, making them differ from bills of sale. They also include very detailed information about the transaction.

First, the contract covers the basics such as who is involved, the buyer and seller and their information. It has the type of sale, dates of the initial agreement, if there has been a deposit made, when the contract conditions must be completed and the date of the final closing of the contract and transfer of ownership.

In addition, here are some of the other details that should be specified in the contract:

Property

If the transaction is dealing with real estate, there will need to be a detailed description of the property. This will include any deficits or defects that are known about the building or property. In this section there may also be stipulations for the buyer to have the property inspected. If they then find a defect that was not presented by the seller, the buyer can renegotiate or back out of the contract completely.

Financing

If a mortgage or loan is going to be used for the purchase, the agreement will need to outline the basic financial terms for the sale. This will include interest rates, amount financed, down payment, escrow funds, sales commissions, sales tax and other financial figures. If the funds are not produced, terms of termination of the contract and release of all parties from further involvement are included. 

Ownership

In this portion of the purchase and sales agreement, it will be stated that the seller has the right to sell the property and will sign over all ownership paperwork and records. It will also outline the seller’s responsibility to pay off any current mortgage, loans, liens, back taxes, and transferable utility bills before the sale is closed.

Addenda

This term refers to extensions or additions to the original purchase and sale agreement. Since these contracts are considered living documents, they are often subject to revisions. Both parties can add addenda. Often they are added because more time is needed to complete part of the agreement. When both parties agree to the terms set forth by the addendum, it becomes part of the contract.

These contracts contain a lot of information and conditions. Having an attorney to assist with the process makes it much easier and smoother. As in-house attorneys, InnovaCounsel has experience with these types of contracts, and can handle them for their clients who are selling or buying property or business assets.