What Is Offer to Purchase and Contract NC?
An offer to purchase and contract NC is an agreement between two parties within the realm of realty in North Carolina.3 min read
An offer to purchase and contract NC is an agreement between two parties within the realm of realty in North Carolina. These contracts begin with an offer and become legally binding once the offer is accepted.
What Is the North Carolina Offer to Purchase and Contract?
If you plan to sell your house in the state of North Carolina, you'll want to make sure your home is ready to sell. This could include major home improvement projects or just some new paint and cleaning. Once you've gained interest from a potential buyer, they will put forth an offer with a North Carolina offer to purchase and contract.
This home-selling contract is one of the most important legally-binding documents in any transaction regarding real estate. The North Carolina Association of Realtors develops offer to purchase and contract documents to be used in sales throughout the area. Members of this association have a joint forms committee, that also includes members of the North Carolina Bar Association, which is responsible for developing forms and legal documents.
A North Carolina real estate agent will work with you when you're ready to sell or buy a home. Home buyers can learn about the terms and conditions included in purchasing a home in the state. If they're prepared to move forward for a particular property, the agent will fill out an offer to purchase and contract will the specific offer the buyer has agreed to on the form.
Some other important details included on an offer to purchase and contract include:
- The due diligence fee
- The due diligence period
- Earnest money
- Date for settlement
- Specific items to be left in the home or removed from it (appliances, etc.)
- Terms and conditions of the loan
- Closing cost requests
- Details of the home warranty
Certain addendums may also be added to the 12-page form of the initial offer from the home buyer. Homeowners association (HOA) requirements, conditions, or fees might be listed. If the home buyer has any property assessments performed, those findings could be detailed in the document as well.
Because these forms are so long, detailed, and important, it's a good idea to make sure you have a realtor or lawyer look over it with you and make any necessary clarifications or answer any questions you might have.
From Offer to Contract
The offer to purchase and contract does not start out as a contract, but simply an offer. The home seller has some options when they receive an offer to purchase and contract from a home buyer. Here are the options:
- Accept the offer as it stands (meaning that you agree to everything detailed in the document)
- Reject the offer as it stands (complete rejection of the contract)
- Prepare a counter-offer (accept some aspects of the original offer but with some changes)
If a seller chooses to create a counter-offer, this will be presented to the buyer and discussed with the agent. This could turn into a negotiation period with multiple offers and counter-offers, but that can be a good thing if each party is willing to compromise a bit. It's important to be sure that your realtor is working to get you the best deal.
Once both parties come to an agreement, the buyer and seller will each sign the form. This act of signing the document is what turns the offer to purchase into a purchase contract. Along with the signatures of both parties, due diligence fees and earnest money will also be exchanged.
Due Diligence and Earnest Money
Earnest money is a sort of down payment from the buyer to the seller on the process of the offer. This money acts as a good faith payment to show the buyer's thankfulness for the seller considering their offer, missing opportunities for other buyers, and going through the process with them. Ideally, the offer is eventually accepted and the contract is signed, in which case the earnest money is returned to the buyer.
Due diligence periods and fees allow the buyer the time to do their due diligence when it comes to inspecting the property and such, but they pay a fee to the seller and agree on a time period. As long as the sale closes within the due diligence period, the fee is credited back to the buyer, but if not, their fee and earnest money can be held by the seller.
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