On paper, the process of buying a property is not that difficult. But discarding that paper just like you would any other ‘’terms & conditions’ tab while purchasing a software etc. can seal a bad fate for your money.
The paper that is being referred to here is the contract that you sign with the seller which has the following information entailed:
The names of all individuals involved on each side
The provisions and the schedule of execution of the deal
What Are These Provisions?
If you search up online you will find a very standard text which is circulating around the US, which can then be altered in any way both parties are agreed. The difficult bit here is that sometimes a dealer might legally challenge you by getting you to sign something which you were never agreed to, and you will not be able to claim the mistake because you signed it.
It is your basic right to know exactly what you are signing, especially when such a big sum of money is involved. Therefore, this feeling of urgency that might take you over while you are about to sign the contract can lead to your mind disregarding the importance of these provisions, and that can be a fatal blow to your financial position.
Why Is It Important to Carefully Assess the Contract?
1. The Advance Payment
Property dealers in the country follow this system of taking an advance amount as “earnest money” which is used to confirm your willingness to go on with the deal till you become the rightful owner of the property. This earnest money is exchanged at the moment when the contract is signed, and the amount is written in the document.
By law, it is not that simple to turn back from a deal simply because you are not in the mood to finalize it anymore; you need a solid reason. And unless you are able to present your financial agent or lawyer with such a reason, you won’t be seeing that amount. Also, not reading the contract is not a valid reason.
2. Lawsuit Against the Buyer
This does not sound very secure and trust us it isn’t. In many states, the autonomy offered to sellers is quite strong simply because the practice which is being normalized is that of honoring covenants. Turning back from the contract and even agreeing to give up the earnest money is not always sufficient to get you out of the tough spot, because if a lawsuit is filed against you, you may be compelled to buy the property by law.
That also means that you will have to abide by the terms and conditions which did not meet your comfort zone earlier on.
What Else Can Save You?
The earnest money is a small amount when compared to what you agreed to pay, so giving it up may not be that costly in the long run. However, if there were some liquidated damages or hidden information which you get to find out after the contract is signed, then you get a valid reason to escape from the deal without any damages. So, tread carefully so that the “my land” doesn’t become a landmine.