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What is a Contract of Sale?

Contract of sale

There are several legal documents that are part of the conveyancing process and must be completed in order for a real estate transaction to be completed. One of the most important of these documents is the Contract of Sale. This document sets out the terms and conditions agreed upon between the buyer and seller in a clear and concise manner.

(A good real estate agent will have professional connections to conveyancers and conveyancing solicitors, you can compare real estate agents upfront at LocalAgentFinder and get the expert advice to help you sell your property.)

The Contract of Sale can be prepared by a conveyancer, solicitor, or real estate agent. When the house is sold privately this task tends to go to the seller’s real estate agent. You’ll want to choose a real estate agent who has the experience to create a solid contract.

What’s included in a Contract of Sale?

There are several details that will be included in a typical Contract of Sale, these include the following:

  • Conditions of the sale, such as financing information or additional building inspections
  • The names of the vendor and purchaser
  • The property’s address
  • The amount of deposit that must be paid
  • The sale price of the property
  • The date of the property settlement
  • Whether the property will be available as a vacant possession, or if it is subject to a lease
  • Other personal property sold as part of the package deal

How is the Contract of Sale Completed?

The purchaser usually signs the Contract of Sale first. They submit their offer to the seller, which includes price and any additional conditions. From the moment the buyer signs the contract, it becomes a legal and binding document. It’s important to note that although it won’t be activated until signed by the vendor as well, it is still binding with only one signature.

Some buyers believe that this is merely an offer to be presented, but as the offer is being submitted in the form of a legal contract, it binds the purchaser from the moment they sign it. From this point, the only way that the buyer can get out of this contract is if they revoke the offer before the vendor signs it. Or if the vendor chooses to reject the offer. It’s a good idea for the buyer to ask their solicitor or conveyancer to look over the Contract before signing for this reason.

Another important detail to consider is the date on which the purchaser signs the contract. This is the date when the three-day cooling off period starts. Many people mistakenly believe that the cooling off period doesn’t begin until the vendor signs, but that’s not the case.

Generally, the initial Contract of Sale is prepared by the seller’s real estate agent, conveyancer or solicitor. Details such as the selling price and settlement date are left blank for the purchaser making the offer.

Contract of Sale – what’s next?

You can compare local real estate agents at LocalAgentFinder. To help you through the legal process of buying or selling your property, LocalAgentFinder can assist you in finding a real estate agent with professional connections to conveyancers and conveyancing solicitors.


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