When you are the listing agent and receive a faxed contract along with a letter from a lender it is normal to read the contract and try to read in between the lines. On the first go around it is for terms, price closing dates, seller contributions, special stips. The review of the contract is to double check the offer, making sure you get all the facts straight. It is then a customary practice to touch base with the agent over the phone, again making sure you have all the pertinent details correct, and then call the lender before you contact the seller. So far so good?
Then I like to read the contract for red flags...just to make sure what is the intent of the contract. A short closing date with a low price is OK, because it shows a motivated buyer has the ability to get the seller out of a home quick! So it is an important term. Then there is the contract that that says they do not have real estate to sell in order to buy this current home, but the buyer does not want to close for 4 months! A scary scenario for any seller to take the home off the market for that long a time. Why? More risk! To compound that the earnest money amount is not filled in. No amount means I do not even contact the seller. I preferably would like to see a copy of the earnest money check, and in fact it is required by my office. But now the next item...$500 on a 600K home? I don't think so! More like several thousand dollars would be a better idea. Another item that may make you suspicious in a pre-occupancy agreement, or a contingency offer on a home that when you question the other agent then you find out the home is not even listed, and there isn't even an offer on it!
What do you look for in a contract? What signs do you see that make you ask more questions because something smells fishy or does not appear to be right?