Contracts have always played a huge part when dealing with various sample agreements, especially when it comes to business between two parties. Although there are many types of contracts that can be used for many purposes, there is one contract that can be used when entering an agreement that involves the purchase, lease, or management of a property. For example, when purchasing a real estate property or a piece of land, a written agreement is essential for both parties to understand the scope and limitations of the agreement. The best thing about contracts is its versatility in the field of business contract, although there are common features of each contract and that is to protect the rights of each party should there be an issue or problem later on in the agreement.
It comes with absolute necessity for a buyer and seller to come to a point of agreement and, thus, establish rules that are not destructive to the other party. It is always important to sign a written agreement to ensure that both parties clearly understand their rights as well as their responsibilities. In this article, you will be able to read about the real definition of a property contract, as well as its importance. You will also find the steps for creating one, the elements that you need to include in order to have a legally valid contract, and the types of property contracts that you can use depending on the type of transaction. We also have property contract templates and samples available for download on this page or on our website.
Residential Property Contract Template
Real Estate Purchase Contract
Sublease Property Agreement Contract
Sale of Property Contract
Professional Purchase Agreement Contract
What Is a Property Contract?
A property contract, which is also called a land contract, is a type of contract that is used for the purchase, lease, maintenance, or management of a particular property or a piece of land. It is a document that contains a detailed information on what was agreed upon by both parties. To help you further understand the importance of having a property contract, the importance of a property contract are as follows:
- A property contract is important when purchasing a property. Having a written document that clearly indicates the buyer and the seller, as well as other important information regarding the property being purchased, is a necessary step before a finalizing the transaction.
- Just like other types of contracts for employment, a property contract also contains the terms and conditions of the transaction. This is important to ensure that both parties understand all the important details before entering the agreement, particularly the consequences that one can face should the other party breach the terms and conditions indicated in the document.
- A property contract is also important if you want to rent out or have a property leased. Providing a contract to the tenant ensures that you are protected from any damage on the property and if the tenant fails to pay on time. On the other hand, a property contract agreement is also useful for the tenants since it protects them from any unlawful eviction.
- A property contract is important since it allows both parties to fully understand what to expect from the transaction. Having a contract helps prevent any misunderstanding or problems between the buyer and the seller throughout the transaction or agreement.
- A property contract is also important especially when both parties come into a disagreement in the future. The contract is used as a basis to resolve any issues in order to, as much as possible, avoid taking the issue to a legal court.
Land Use Agreement Contract
Commercial Property Sales Contract
Components Needed for a Contract to Be Valid
A contract cannot be considered a legal document unless it contains certain elements or components. To ensure that the contract you have is legally binding, make sure that these components are present before signing one.
The Parties Involved
It is important for a property contract, or any other contract, to clearly specify the parties involved in the sample agreement. For example, if you are creating a property contract for the purchase of a property, specify the buyer and the seller of the property, including their addresses, titles, and contact information.
Consent of both Parties
In order for a contract to be valid, having the consent of both parties is necessary. Both parties must clearly understand the contents of the contract and should not be forcefully signed due to undue influence, fraud, and so on.
This part of a contract sample refers to the thing being agreed to by both parties. The object of the contract should be based on the law and should also be possible to enforce.
In every contract example, it requires consideration. What exactly does this mean? This means that both parties involved in the contract should earn something from the transaction. When purchasing a property, for example, the buyer must pay the seller, the amount of the said property for a particular period of time depending on the agreement.
Often, people create and write contracts without considering these elements and ensuring that they are used as a basis on how a contract is made. Without these components, a contract is not considered valid and legally binding. This is why it is important to always have a written document, especially when it involves money and other important matters.
Property Rental Agreement Contract
Property Contract for Deed
Property Maintenance Contract
Creating a Property Contract
There comes a time when the need for a property contract may arise. Before you start grabbing a pen and writing your own contract, it is important that you clearly understand the steps that you need to do and the information that you need to include in your contract in order to create an effective and usable document. The steps for creating your own contract are as follows:
- The first step to creating your employment contract is to create a title. Specify the type of property contract you are creating, whether it is for the purchase of a property, the leasing or rental of one, and so on. Also, write the date when the contract was created.
- Write the names of both parties and include all the essential information such as their address and contact numbers. Ensure that each party has a title that will be used to refer that particular party throughout the contract.
- Write in detail the description of the property. Write the complete address of the property and a description of the house (if any), property size, etc. You can refer to your property documents for other needed information.
- Sometimes a seller may include his/her personal property in the sale. If this is the case, it is important to specify the items included like the furniture, appliances, and so on.
- Next, write the terms for payment. Specify the amount the buyer has to pay the seller on a monthly basis, as well as the interest, and the penalty for late payments. Moreover, state when the payments will start and end.
- Outline the rights and responsibilities of both parties, including their obligations. State in the contract, the assigned party responsible for the maintenance of the property, payment of property taxes, and the use of the property.
- Finalize the contract agreement by writing an integration clause. The integration clause prevents any party from claiming that the contents of the contract are not what both parties have agreed upon when the contract was created and signed.
- The signature of each party should be written on each page of the contract to indicate that they have clearly read and understood all the components, terms and conditions, and clauses.
Now that you have created your property contract, you can have it checked by a real estate attorney or a lawyer to check whether the contract is legally binding and valid. Additionally, you can download the property contract samples, land contract templates, and real estate contract templates available in this article and on our website. You can also browse through our other contract templates like an employment contract, sales contract, advertising contract, and much more.
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