First Time Home Buyers and the Purchase Contract

drive-thru-lawyer-70x701The North Carolina Offer to Purchase and Contract is prepared by the North Carolina Association of Realtors in cooperation with the North Carolina State Bar.  So, the Realtors and the Lawyers take part in drafting the standard contract.  You should look at this link to the North Carolina Offer to Purchase and Contract, so you can see the entire documents.

 

The first part introduces the cast of characters.  You are buying the house from the seller so the blanks are filled in with the appropriate names.  The house is identified by its mailing address, legal description and references to the tax records when the blanks are filled in.  The contract wants to be sure the house is properly identified, so you do not get the wrong one.

 

Next, there is a discussion of fixtures to specify what is included in the purchase price, so that you get the light fixtures and plumbing fixtures that you expect.  There is also a discussion of any personal property included in the sale, like a washer, dryer and refrigerator. 

 

The total price to be paid for the house is in the first blank of the next paragraph.  The blank after that has the amount of the earnest money.  Earnest money is a deposit to show that you are serious about the purchase, and to get you to have some “skin in the game.”  The contract goes into detail in other provisions specifying when you would get that earnest money deposit returned and when the seller would get to keep the earnest money.

 

There are a series of blanks for other deposits and payments, most of which are usually zero in the average purchase agreement.  The last blank is the balance of the purchase price, so the amount in that blank plus all the other blank lines above it should equal the total purchase price, unless your real estate agent cannot add J .

 

The next paragraph talks about the financing.  If the blanks in that paragraph are filled in, then the sale is contingent on you being able to get financing.  The blanks specify the type and amount of financing that you need, as well as the interest rate.  So, if you can get that type of loan at that interest rate, or better, you are saying you will proceed with the purchase of the property.  If you cannot get that financing, there is a time limit where you need to cancel the contract before that time limit runs out in order to get your earnest money back.  

 

The first two pages of the North Carolina contract are where most of the information is entered by the buyer.  So, if you understand what the questions you will be asked when you make an offer, you will know the answers and it will be easier to proceed with buying your first home in the Raleigh area of North Carolina. 

 

 

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  • Brooke Fraser

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