Our market is rather fortunate to have two fairly standard contracts for the purchase and sale of residential real estate, each of which, generally speaking, treat buyers and sellers rather fairly. It is for that reason that most attorneys are fine with the standard contracts as drafted, although a few attorneys will tweak certain provisions here or there. Despite the availability of these contract forms, we still see numerous instances, with or without real estate agents, in which the parties elect to use a “non-standard” form. For purposes of this article, a non-standard form is any form other than the FAR/BAR approved Residential Contract for Sale and Purchase and “As Is” Residential Contract for Sale and Purchase.
Non-standard forms come in all shapes and sizes, but they generally have one thing in common, they are extremely short and typically lack information that is required to properly close a transaction. In many cases, they may lack information to make it even legally enforceable under Florida law. With that said, if you are forced into any situation in which a non-standard contract is to be used, we encourage you to verify or carefully consider the following (i.e. the basics):
1. Are the parties properly identified and have all parties properly executed the contract
2. Was the property properly described (including any personal property)
3. Are deposits properly addressed
4. Is the closing date clearly spelled out
5. If financing is involved, how is that to be addressed
6. Who will select the closing agent and who will be paying which closing costs
7. How are title and survey related due diligence to be handled
8. How are association and government assessments to be handled
9. How are permits and code enforcement issues to be handled
10. How are inspections to be handled
11. What happens if one party breaches the contract or otherwise fails to perform, and who will pay the costs of enforcement
12. How is title to be delivered
13. What closing documents are to be delivered and by whom
14. How are tax and/or rent pro-rations to be handled
15. Who is obligated to pay real estate commissions and in what amount.
This list is by no means even remotely all inclusive, but as you can probably see, it is unlikely that even these issues can be adequately addressed in a one or two page contract procured on-line somewhere. And yet we have seen issues associated with each and every one of these items when dealing with non-standard contracts, issues that can cause the contract to be difficult, if not impossible to enforce properly.
With that said, the non-standard contract is not going away. Most people who search the internet for a contract do not understand the complexity of a real estate transaction. For that reason, we strongly advise you to seek the assistance of an experienced real estate attorney before your client enters into a non-standard contract.
Berlin Patten Ebling, PLLC
Article Authored by Evan N. Berlin, Esq. firstname.lastname@example.org
This communication is not intended to establish an attorney client relationship, and to the extent anything contained herein could be construed as legal advice or guidance, you are strongly encouraged to consult with your own attorney before relying upon any information contained herein.
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