The real estate commission approved contract in my state is 16 pages long and in my opinion, full of irrelevant information needed to lock up a property to wholesale, assign, and use when an investor is using all cash to purchase the property. Also I feel like the seller you are purchasing the property from could become confused by such complexity of terms and provisions that are irrelevant when doing a simple purchase agreement when not using a broker or originating a loan.
I haven't used the state approved contract to wholesale deals but I hear people say to use it because the state recognizes it and will protect you when filled out correctly. The kicker is, I would have to place "N/A" on many terms that are not applicable, which really cloud the terms on the contract that are applicable.
Do investors really use a 15+ state approved contract for a simple purchase agreement with sellers? It seems like the safe route to go but I also feel that a simple 2 page agreement would work also, considering all terms and provisions apply. Simplicity is key right?
Can you edit out the n/a paragraphs(some if not all) via Excel or whatever software you utilize? That is a lot of pages yet if people in your state is accustomed to it then it shouldn't be a problem...
@Mary B. Do you mean just taking out the provisions that apply and just using it for my own contract?
@Michael Gee I understand a 16 page document is quite lengthy and you may not be able to omit every paragraph that doesn't apply(2 out of 5 sentences may apply) but if you can make it a 12 page doc by excluding those paragraphs that are absolutely inapplicable that may help. If you do the amendment via software and save the changes it will help time wise for the next deal so you won't have to amend the document each and every time you want to make an offer to purchase....
@Mary B. Thank you for your help. Looks like I have some deconstructing to do :)
Create one from scratch, or use a different one. If you leave the name/form number of the contract in it, you may have some misrepresentation issues later on. I assume you'll be removing some clauses that propetect the seller.
I agree with @Wayne Brooks and of course @Wayne Woodson. But rather than create one you can just ask one of us for ours and edit it for your state. You will probably want to use an Purchase and Sale agreement contract and a Option to Purchase contract.
the reality is that those contract are used and written that long for a reason. And that irrelevant info is there to protect your interest. You will not bore your buyer because chances are they have signed them time and time again and they no the process better than you. Don't try to reinvent the wheel!
I'd use the standard contract. A one page "intent" agreement can summarize the deal, but I'd stick to a contract that is "standard" and something all lawyers and judges know. Yes... I'm speaking from experience. Same goes for leases. I have lots of experience in front of judges with leases, and occasionally see other people get in trouble in court with goof-ball one or two page leases that miss vital points that the landlord really didn't think would be an issue when the lease was signed. If they just used the "standard" lease... they would have saved themselves a lot of grief.
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