For the sale of any real estate in Indiana, sale terms must be in writing or they are not considered valid. So there is a written Purchase Agreement which is drawn up, signed by all Buyers and Sellers, which is the last word on what happens in the transaction. It’s really important that the Purchase Agreement is well thought out and reflects exactly what you want.
For a great number of years, we have used standardized forms for any transaction between members of our local Real Estate Board, MIBOR. But several years ago, Indiana went to a statewide approved forms, including the Purchase Agreement. That helps especially if you try to have a transaction with another Broker who is in a different part of the state. The forms were crafted by real estate attorneys with input from practicing real estate professionals. The language is reviewed occasionally and changes that make sense are updated from time to time. As a licensed real estate broker, I’m not allowed to write my own Purchase Agreement and can only fill in the blanks of the approved form since I’m not an attorney. The challenge is, the meaning of a contract can change dramatically even if the blanks aren’t filled in properly. The one ‘blank’ that can be a real problem is called ‘Further Conditions’ where there’s about a dozen or so blank lines where another Broker can write in whatever they want. To me that’s not exactly filling in the blanks.
The devil’s in the details. I learned a long time ago that one little word…or even the absence of one word…can change the whole meaning of a contract. For instance, if a Buyer writes that they want final closing to be on or before June 30th or within 5 days after their loan is approved, whichever is later…and the date for when loan approval must be obtained is not stipulated correctly several paragraphs before, then the closing could, according to the contract, be a month later instead of 5 days…or even a year later for that matter. Do you think the Seller would be happy about that? Especially since they are counting on buying another home that must close July 1st? So the language must be perfect.
As a Broker, I have to express the terms that my client wants and protect them with the right language in the contract. I approach this mainly with just common sense and logic. The thing that ultimately guides me though is that, if there should be a default by the other party and trouble breaks loose, this might be the document that a court looks to for the outcome of a law suit. I have never had that happen or even any hint of trouble ever, but I like to think that maybe that’s partly because I’m careful about the details that are written (or the details that I check that others write) that keeps the probability of there being trouble down to almost zero. Words are important things.
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