QandAs: Loans

What is an Agreement of Sale?

Answer:
If you plan on selling your home with or without

a real estate agent, you’re likely familiar with an agreement of sale. In a real estate transaction, an agreement of sale is a very important document.

This agreement covers all details of the transaction such as contingencies, deposits, and other terms. After a buyer and seller agree to specific terms, this document obligates both parties to uphold their end of the deal. Due to the documents importance, it is recommended that a real estate agent represent the buyer and seller. This ensures that all principle items are covered within the agreement of sale.

Home sellers and potential buyers can negotiate a variety of terms within a real estate transaction. Typical items covered within the agreement include the purchase price of the property, security deposits, closing date, contingencies, and so forth.

The buyer may agree to lease back to the owner, or the seller may agree to pay the buyer’s settlement fees. If so, these items must be included within the agreement of sale. In some instances, the buyer may include an item wherein the agreement is contingent on their ability to secure a home loan or sell their current home.