Purchase and Sale Agreements Flashcards
When does the buyer have Equitable Title?
When the purchase and sale agreement has been signed by all parties.
What is the difference between an Amendment and an Addendum?
Addendum is attached to the agreement before it is signed, an amendment is added after.
Should both spouses sign the PSA if only one spouse owns it?
Yes, as a precautionary measure so the non-owning spouse releases any possible legal interest in the property.
What happens if the property is damaged before closing?
If the property is not in the same physical condition as it was when the offer was made, the buyer may not need to complete the transaction (unless other agreements were made).
What is the limit on liquidated damages?
5% of the purchase price.
When is the Seller Disclosure Statement required?
In all transactions and it needs to be delivered to the buyer within five days of signing the PSA. The buyer has three days to rescind based on info in the statement (buyer’s sole discretion).
What happens if new information comes to light that contradicts the Form 17?
Seller must either give an amended disclosure or take corrective action so that the disclosure statement is accurate once again. If no action is taken, the buyer may either accept the amended disclosure statement or rescind the agreement.
When is a lead paint disclosure required?
Any houses built before 1978. Buyer must be offered a ten-day window to inspect, but the offer cannot be terminated based on that inspection unless there was an inspection contingency to that effect.
