| This is not a binding contract.
For both
parties' protection you need to prepare a contract with a lawyer's
assistance. If sample clauses are not agreeable, you can stroke them
out if both parties initial the changes.
Purchaser(s)
Purchaser name(s):
address and phone number:
Vendor(s)
Vendor name(s):
address and phone number:
Property
civic address:
legal description (if available):
Purchase Price
| accompanying deposit: |
|
$ . . . . . . . . . . . . .
. . . |
(usually $1,000) |
| balance of deposit (if
any): |
|
$ . . . . . . . . . . . .
. . . . |
(usually determined with lawyer) |
| first mortgage: |
|
$ . . . . . . . . . . . .
. . . . |
|
| second mortgage: |
|
$ . . . . . . . . . . . .
. . . . |
|
| balance of down payment: |
|
$ . . . . . . . . . . . .
. . . . |
|
| |
|
_____________ |
|
| TOTAL: |
|
$ |
|
"Subject To" Conditions
The following conditions are inserted for the
benefit of, and may be waived at the sole option of, the Purchaser.
Each condition must set specific objectives
which the purchaser must attempt to meet in good faith, and must
include a deadline for completion.
NOTE: the fewer the conditions, and the shorter
their deadlines, the more attractive the offer to the Vendor. Some
examples:
- This offer is conditional on the Purchaser
arranging for, and receiving within 10 days from the date of acceptance
of this offer, a satisfactory professional home inspection of the
property.
- This offer is conditional on the Purchaser
arranging, within 10 business days of the date of acceptance, mortgage
financing of not less than _________ thousand dollars, at an interest
rate not to exceed _____% per annum, and IP payments of no more than
$_____ per month.
This offer is conditional on a review and
approval by the Purchaser's lawyer, within 5 business days of the
acceptance of this offer, of its form and content.
This offer is conditional on the Purchaser
obtaining an unconditional agreement for the sale of his or her
property, located at _____________________________ within 30 days of the
date of acceptance of this offer.
If purchasing a condominium: This offer is
conditional on the Vendor's providing the Purchaser(s), within 5
business days of the date of acceptance of this offer, with a
satisfactory and current estoppal certificate providing
information on the development's current finances and insurance and on
any restrictions on the renovation or use of the subject property.
Conditions
to the benefit of the Vendor, and may be waived at the sole option of, the
Vendor:
This offer is conditional on the removal by the
Purchaser(s) of all subject-to clauses within 72 hours of receiving
written notice by the Vendor of an unconditional bona fide backup offer,
failing which removal, this offer will become void and all deposit
monies shall be returned to the Purchaser(s). This condition is inserted
for the benefit of, and may be waived at the sole option of, the Vendor.
This offer is conditional on the Vendor's
receiving within 5 business days of the acceptance of this offer,
written confirmation from the Vendor's bank that all liabilities of the
Vendor relating to the existing first mortgage shall cease upon said
mortgage being assumed by the Purchaser(s).
Fixtures and Chattels Included or Excluded
Encumbrances
Need to be discussed with your lawyers.
Warranties and Disclosures
Need to be discussed with your lawyers.
Completion, Adjustment and Possession Dates
The Purchaser(s) may take possession at noon
on the ____ day of ___________, _____
Associated Costs
The Vendor(s) will bear any costs entailed in
clearing the Title and preparing its transfer, in preparing any take-back
mortgage(s), in discharging any encumbrances not assumed by the Purchaser(s),
in any mortgage prepayment penalties, and in any real estate commission.
The Purchaser(s) will bear any costs involved
in the Title search and registration, in obtaining any new mortgage(s), and
in any property appraisal and/or house inspection.
Other expenses to be borne by either party:
Tax Issues
The Vendor(s) will pay the taxes relating to
realtor fees (if any) involved in the sale or to other expenses to which
they've committed. The Purchaser(s) will pay any GST or PST applicable to
the purchase of a new home or to other expenses to which they've committed.
(GST is not normally an issue with residences that the vendors have occupied
for 6 months or more.)
Cancellation and Default
The deposit will be returned to the
Purchaser(s) if the offer is not accepted, falls through because a condition
could not be satisfied in time, or if the Vendor defaults (in which case the
Purchaser(s) may pursue other remedies as well). If the Purchaser defaults,
the deposit is forfeit to the Vendor(s), who may also seek other remedies
against the Purchaser(s)
Other Clauses
|
For an assumed
mortgage (if any): |
| mortgagee: |
|
|
| amount: |
|
$ |
| interest
rate: |
|
_______% per annum |
| end of term: |
|
_______ day of
_________, ______ |
| IP: |
|
$ _______/month |
| |
|
|
|
For a new mortgage
(if any): |
| maximum
amount |
|
$ |
| maximum interest rate: |
|
_____% per annum |
| maximum amortization: |
|
____ years |
| maximum term: |
|
____ months |
| maximum IP: |
|
$ _____/month |
Deadline For Acceptance
This offer is open for acceptance until 11:59 p.m. on
the ______ day of ______________, ______ after which time (if not accepted)
it will become void and the deposit will be returned to the Purchaser(s).
Signatures
| ____________________ |
____________________ |
_____________ |
| Purchaser |
Witness |
date
|
| ____________________ |
____________________ |
_____________ |
| Purchaser |
Witness |
date
|
| ____________________ |
____________________ |
_____________ |
| Vendor |
Witness |
date
|
| ____________________ |
____________________ |
_____________ |
| Vendor |
Witness |
date
|
| fixtures |
If you need tools to remove it,
it's a fixture and will be included in the purchase price unless
specifically excluded. Anything not firmly attached to a building is a
chattel and would not stay with the property unless specifically
included in the purchase price.
Be careful to list all major appliances and items
of furniture to be included in the purchase, noting makes and model
numbers where possible. As well, you may wish to include, under the
"Warrantees" section of your contract, a statement guaranteeing the
working condition of specific appliances.
|
| negotiations |
It is normal for an offer to go
back and forth several times between purchaser and vendor before an
acceptable price and terms are determined. This should always be done
on paper! Here's how . . .
The original offer, signed and witnessed by the
purchaser(s), is presented to the vendor(s). The vendor(s) make any
changes by crossing out the relevant details - price, chattels,
possession date, deposit, etc., replacing them with the preferred
alternatives, and initialing each amendment. Then the document is
returned to the purchaser(s) for consideration. This can happen several
times.
Once all final changes have been initialed by all
parties, you have a SALE (pending removal of any subject-tos, of
course). Be sure to see a lawyer.
|
| possession date |
As with the closing date, it is
best to avoid the last or first day of the month - in this case to
ensure availability of a moving van!
In any case, DO NOT take possession of a property
before the closing date, as that could leave you in a difficult
situation should the condition of the property come into dispute on
closing.
|
| "subject to"
conditions |
Conditions are usually inserted,
and waivable, at the discretion of the purchaser, and are often prefaced
with a statement like "The following conditions are inserted for the
benefit of, and may be waived at the sole option of, the Purchaser."
NOTE: conditions may also be inserted for the
benefit of the Vendor:
|
| |
This is not a
contract--essential clauses are not covered, however it will help make
sure both parties are agreed on most of the significant points in the
transaction. Be sure to bring this to a lawyer to have a contract
prepared. |
|
