The heart and soul of every real estate transaction here in California is a 10 page document called the California Residential Purchase Agreement and Joint Escrow Instructions (RPA). When presented to the sellers as an offer on behalf of the buyers, this document is about 95% preprinted. Most people do not read everything they sign, this time, however, we encourage you Mr/Mrs home buyer to read it in its entirety and to educate yourself about the key components of this legal contract
The RPA is a multi-functional document. It contains the essential terms and conditions for the formation of a real estate contract. It becomes a legal, binding contract when it is signed by the buyer and seller and comunication of the acceptance is received. The RPA is adequately detailed to address most issues involved in the typical purchase and sale of real property. There is an important reason for each individual clause in this document. Buyers and Sellers should read every clause in every page.
Among others, the fully signed RPA serves as: A) A bona fide offer to purchase real property. B) It represents a receipt for the good faith earnest money deposit. C) It also provides written joint escrow instructions from buyer and seller to the escrow or closing company. D) This document includesa Mediation and Arbitration agreement between the parties. F) It provides a confirmation of the Agency Disclosures & Relationships.
Every real estate transaction creates a lot of questions and the RPA contains in their printed form most of the answers, some are answered by a simple check mark on a small box. That small check mark for example indicates which party pays for what, and that can be hundreds, maybe thousands of dollars to one of the parties, so it is imperative that you read every single line of the agreement and undestand your rights and duties before you sign. Home Buyers should get a blank RPA to read it BEFORE they go out to look for homes to buy...