Step 5 of Overcoming The Mid-20's Crisis: Writing the Contract

Depending on what state you are in depends on what happens next, because in some states only lawyers can write contracts, unlike in the center of the real estate universe (a.k.a. my immediate surroundings) where I can actually sit down and write a contract with you, without the help of a lawyer. So for all of you who are not in direct contact with the central point of everything good that happens in real estate, please contact me with your questions and I can refer you to another agent who, while not as personable as I am, is just as versed in the subject at hand. Feel free to keep reading for entertainment purposes though.

You've handed me the contract that I had supplied to you during our buyer consultation a few weeks prior, letting me know that you are ready. You have done it, you have found the home that is the closest to perfection that you will find right now. I can feel the excitement permeating from your body. I know that we have a match. Depending on whether or not the house is vacant, we may sit at the kitchen counter and write the offer there, or we may move to a separate location, i.e.; Caribou Coffee, Starbucks, Lazy Bean, etc., etc., etc.

If you have followed my sage-like advice during our buyer consultation and actually read the contract before this moment than we can breeze through the contract writing process, and get this offer faxed off in just a few shakes of a Polaroid picture. We'll assume that my words were spoken, but failed to register for the sake of this article.

So there we are sipping on our piping hot half-caf, caramel macchiatos with half skim, half regular, one with foam, and mine of course without, with just the right amount of chocolate shavings for flavor and I pull out a gigantic stack of papers that appears like you are going to have to sign away your first born child. Not to worry, neither I, nor the sellers want your first born.

I begin scribbling ferociously on the pages and in just a few moments the contract is filled out. I would love for you to sign blindly and trust me, but I know it won't happen. I turn it around and I begin to go through each page with you. First and foremost, I will explain to you how I and Keller Williams Realty will be representing you, and whether we are in a Dual, Designated, or Standard Brokerage Relationship If it is a standard brokerage relationship I will inform you of who will be representing the sellers, and what we can expect through the transaction.

Then comes the fun part, we talk about how much you want to spend. We'll discuss down payments, and first and second trusts, and different loans, which you are already well informed on because you got that letter with you saying that you've been approved. After a little discussion we'll come up a number that will get you the best deal possible, while letting the sellers know that you mean business. Remember, the first offer is very rarely accepted, there will probably be a counter.

Then we will discuss the Earnest Money Deposit, which is the Deposit that you have to put down to show the sellers that you are serious about purchasing there home. I recommend 1% of the sales price to let them know that we are serious about our offer. It is a check that will be cashed the moment the contract is ratified (everyone agrees and initials everything), and will go toward your closing costs, down payment, whatever.

The joy of being in the wonderful Commonwealth of Virginia, as I am, (and for all of you considering a move to "America's Most Livable Community" please call me, I'd love to show you your next home) is that you as the purchaser gets to pick your settlement agent, settlement date, and time. If you have a settlement office in mind that you would like to use, we can use them, or if you don't know of any, I have relationships with a few of them that I would love to refer to you.

We will then review the different items that will be included with your new home; microwave, ceiling fans, washer, dryer, dishwasher, etc., etc. It's all basic stuff that since you've been through the house you've already seen and know is there.

Then comes the Seller Subsidy paragraph, where we ask the Mr and Mrs Bob Seller to give us some money toward our closing costs. It's a BEE-EEE-A- Utiful paragraph in a Buyer's Market, and one I will skip over most of the time in a Seller's Market.

The Appraisal is the next item on our list, which we've been over, but since you didn't read the contract like I so kindly asked you to do, I'm willing to bet that you forgot about what we said about the appraisal and how it protects you, the buyer, from spending too much on your home.

The rest of the VA contract I will breeze through with you. I'll touch on the Purchaser's Representations which means you'll be living at the property. Yes, you have to tell me and your lender this piece of information. It's important to the validity of the contract, and we don't want to be invalids. We'll go over different things that you can do to Default, or lose the house and the earnest money deposit that you have already handed to me. Basically, my advice on this is, "After you sign this contract, Do Not Buy Anything Bigger Than A Toaster until after the settlement"

That's when I will tell you all the different ways that the contract could fall through on a page known as the Contingencies/Clauses Addendum. I will recommend the Home Inspection for every client from here until the end of my career. This protects you from buying a dump that appears to be a castle. The home inspector is your sober buddy who is saying, "Hey, are you sure you want to take that home with you?" while you're a little intoxicated. This is the person that you will thank in the morning for stopping that questionable hook-up.

After that, we'll fly through the rest, a page here on your rights and obligations that if you read you will realize I've already said everything in it, some of it twice. A page there on how to look up Sexual Offenders in your area, or you can have some fun during the slow days at your office and click here. Another signature here, an initial here, a handshake with me, a quick slurp from your half-caf, caramel macchiato, with half skim, half regular, with foam, and just the right amount of chocolate shavings for flavor, and you are done.

You now have an offer that is on the table for negotiation, and now you know, and knowing is half the battle.

As always, you have the right to contact me by phone between 0900 and 1900 EST at 703-393-1336, on AIM at KWRMatt, or leave me an email at mrwright79@kw.com. If you happen to see me out and about feel free to say hi. I'm the guy that looks like that anime character to the right.

I look forward to hearing from each and every one of you. Keep on rocking, and we'll get you in that home soon enough.