Sometimes a real estate purchase clause is accompanied by a contingency clause and is included in the real estate contract. In essence, a possible clause gives the parties the right to terminate the contract in certain circumstances that must be negotiated between the buyer and the seller. Contingencies may include details such as the schedule (e.g.B. « The buyer has 14 days to inspect the property ») and specific conditions (e.g.B. « The buyer has 21 days to guarantee a 30-year conventional loan at 80% of the purchase price at a rate not exceeding 4.5%). Each possible clause must be clearly indicated so that all parties understand the conditions. At the end of the home inspection, the buyer receives an inspection report clearly clarifying the condition of the property and any problems the property may have. A financing configuration (also known as mortgage retention) gives the buyer time to apply for and obtain financing for the purchase of the property. This provides important protection for the buyer who can withdraw from the contract and get their serious money back if they are not able to provide financing through a bank, mortgage broker or any other type of loan. Before signing your contract, make sure that the building inspection clause of the contract states that the building inspection must be carried out to the satisfaction of the buyer.
Beware of contracts that state that you can only renegotiate or withdraw a purchase in the event of a structural error. In any case, we recommend that your lawyer provide the contract before signing in order to verify that all clauses, etc., are correct. In episode 16, we will talk about the documentation clause necessary to buy a property in Vancouver. Stay in the game! If the conditions of the contingency clause are not met, the contract becomes null and void, and one party (most of the time the buyer) can withdraw without legal consequences. Conversely, if the conditions are met, the contract is legally enforceable and a party would be contrary to the treaty if it decided to withdraw. The consequences vary, from the forfeiture of serious money to complaints. For example, if a buyer can`t pull out and the seller can`t find another buyer, the seller can take legal action and force the buyer to buy the house. Short time often forces you to use an inspection company that you wouldn`t necessarily have chosen if you had had more time to get your inspections. Short lead times don`t give you enough time to digest the information in the report.
This is not a decision that should be rushed. Right to inspection lawyers write in the sales contract a domestic inspection clause. This clause gives the buyer the right to go to the land and enter the house with an inspector of the buyer`s choice to carefully evaluate and inspect the house for sale. This is a right granted by the owner of the property. In the context of a contract or a real estate sale contract, a « contingency » is a condition that must be met – or an action to be taken – for the sale to progress. There are different types of contingencies, including one that relates to home inspection….