Professionally Written Contracts Are A Requirement, NOT An Option!

By
Commercial Real Estate Agent with Next Wave RE Investments LLC Bullhead City AZ Commercial RE Broker AZ BR 528507000

Professionally Written Contracts Are A Requirement,

NOT An Option!

Contract Writing 101

Contract writing is probably the most important skill we can develop as real estate professionals.

A well written contract makes a HUGE difference.

  • It protects you/your client.
  • It makes life easier for escrow officers.
  • It insulates you and your broker from litigation.
  • AND IT DEMONSTRATES PROFESSIONALISM.

If I get 2 contracts equal in ALL other ways, of COURSE I will suggest to my client that they sign the clear, unambiguous, well written contract over the confusing, sloppy, incomplete one.



Even an otherwise inferior offer that is well written may have an edge!

If your contract writing skills are lacking, take more contract writing classes and practice until you get it right. You are not a truly professional agent until you master this skill.


Here are the necessary basics:

  1. COMPLETE all fields that pertain to your transaction. We cannot mind-read and if it’s not in writing, it does not exist. Blank spaces make attorneys and escrow officers crazy–as they should.

  2. Use SIMPLE, understandable verbiage. Your client should be able to understand what they signed!

  3. Attorneys created most of our R Association’s forms. There is usually no need to change those forms. When you start rewriting, you risk.

  4. Leave OUT nonessential information that will confuse ANYONE. And make sure you do not contradict yourself on one form that changes the meaning–or voids–another.

  5. However, WRITE IN EVERYTHING you wish to convey.

  6. Do NOT EDITORIALIZE.

  7. Stay on point

  8. Check your MATH and SPELLING!

  9. Look at a CALENDAR before inserting critical dates.

  10. Use a separate addendum if you run out of room.

  11. Use a forms program to create your documents when possible.

  12. If you are printing by hand, please make it LEGIBLE. Many offices, and most banks and companies will no longer accept a contract that is not typed.

CONSUMERS: When deciding who will represent you in your real estate transaction, you may wish to ask your prospective representative the recency–and frequency–of their contract writing skills training. If the agent is not getting at least annual skill upgrades, or willing to show you a clear, well written contract sample, YOU ARE AT RISK.

Poorly written contracts full of loopholes make attorneys salivate.

AGENTS . . . write a clean contract = save a broker's sanity.

AND . . . make more/better deals!

 

 


🎶You've got the future in your hand

Signed, sealed, delivered, I'm yours!🎶

Comments (27)

Lynn B. Friedman CRS Atlanta, GA 404-939-2727
Atlanta Homes ODAT Realty - Love our Great City - Love our Clients! Buckhead - Midtown - Westside - Atlanta, GA
Concierge Service for Our Atlanta Sellers & Buyers

Candice A. Donofrio 
Absolutely so true!
A clear post to remind all of us about content AND clarity!
Thanks, Lynn

Oct 12, 2019 09:15 PM
Candice A. Donofrio
Thank you ma'am!
Oct 13, 2019 07:48 AM
Barbara Todaro
RE/MAX Executive Realty - Retired - Franklin, MA
Previously Affiliated with The Todaro Team

Good morning, Candice A. Donofrio the only contract my team members produce would be the offer to purchase.... every client we have has a real estate attorney from start to finish....we don't wear that hat and it's the path of safety for us and our clients.... all of the details of the transaction are on that offer to purchase and it's subject to a fully executed purchase and sales agreement.... 

 

Oct 13, 2019 04:17 AM
Candice A. Donofrio
What about listing agreements? Do attorneys write all your forms? Do you have state forms? We're all so different.
Oct 13, 2019 07:48 AM
Kathy Streib
Room Service Home Staging - Delray Beach, FL
Home Stager - Palm Beach County,FL -561-914-6224

                                          

Oct 13, 2019 04:28 AM
Candice A. Donofrio
💋🙏❤
Oct 13, 2019 07:49 AM
Kat Palmiotti
406-270-3667, kat@thehousekat.com, Broker, eXp Realty - Kalispell, MT
Helping your Montana dreams take root

The same thing is true in states that use a purchase offer (before the attorneys do the actual contract). I received one of the worst offers, in terms of completeness, neatness, appropriate data, etc from one of the "top" performers. It boggled my mind. 

Oct 13, 2019 05:49 AM
Candice A. Donofrio
Also they get rookie assistants who are barely fogging the mirror to write.
Oct 13, 2019 07:50 AM
Richie Alan Naggar
people first...then business Ran Right Realty - Riverside, CA
agent & author

This reminds me of "walk softly but carry a big stick" ...A good contract allows good-players to act like it doesn't exist and bad-players to behave themselves....

Oct 13, 2019 06:32 AM
Candice A. Donofrio
Well said!
Oct 13, 2019 07:50 AM
Leanne Smith
Dirt Road Real Estate - Golden Valley, AZ
Relocation to NW AZ with elbow room & more freedom

Glad AZ has an existing contract so I don't have to deal with the issues you brought forward.  Thanks for sharing your knowledge.

Oct 13, 2019 06:43 AM
Candice A. Donofrio
Anytime!
Oct 13, 2019 07:51 AM
Debb Janes EcoBroker and Bernie Stea JD
ViewHomes of Clark County - Nature As Neighbors - Camas, WA
REALTORS® in Clark County, WA

In my opinion, the contract represents an agent's professionalism. The last thing we want to do is present ourselves as too busy to care, or too sloppy ti know better.  It takes time to write a well-written contract complete with realistic closing dates.  

Oct 13, 2019 07:38 AM
Candice A. Donofrio
It does, time and pre-prep. That's why before we write we check on assessments, financing terms, etc. I got one recently that had seller CC 3% on the pre-qual, and the contract said 2.5%. LOL
Oct 13, 2019 07:53 AM
MaryKay Shumway
The Kellstrom Ray Agency, Inc. (Est. 1948) - Sister Bay, WI
Door County Wisconsin's Real Estate Expert

It absolutely freaks me out that some of the veterans in my area--the people that don't hesitate to point out that they've been working in the industry since the 1970s or 80s---write the absolute worst contracts.  And the funny thing is, I've been working in the industry 15 years and the bad ones seem to just stay bad!A well-written contract is a gem.  Nice post, congrats on the feature.

Oct 13, 2019 01:10 PM
Candice A. Donofrio

Yup yup yup! There can truly be a point of diminishing returns in this business if you don't stay alive and well mentally and physically!

Oct 13, 2019 01:26 PM
John Henry, Florida Architect
John Henry Masterworks Design International, Inc. - Orlando, FL
Residential Architect, Luxury Custom Home Design

Excellent point, Candice.  The AIA has very well thought out contracts and although these are very thorough and intended to protect all parties, I have come to distill things to a couple of pages as long contracts with small print make people very uncomfortable.  But you have to be thorough and follow the advice you have suggested.  Thanks.

Oct 13, 2019 01:59 PM
Candice A. Donofrio
That's another thing. Be prepared to explain the meaning of anything in the contract. All those words make people uncomfortable, but an agent that knows a contract in/out can 'reduce it to pablum' as one of my old college algebra teachers used to say! LOL
Oct 13, 2019 04:09 PM
Marte Cliff
Marte Cliff Copywriting - Priest River, ID
Your real estate writer

It's so easy to fill out every blank - after all, they're blank, sitting there staring at you! And yet...

Oct 13, 2019 02:03 PM
Candice A. Donofrio
They're looking at you with longing eyes, just wanting to be fed!
Oct 13, 2019 04:09 PM
Jeff Dowler, CRS
eXp Realty of California, Inc. - Carlsbad, CA
The Southern California Relocation Dude

Candice:

It's amazing how poorly done some contracts are, although thankfully they are few and far between. Whether it's lack of knowledge or just plain laziness or carelessness is hard to say, but if the offer is not dressed for success, you are not doing as you should for your client.

Jeff

Oct 13, 2019 02:58 PM
Candice A. Donofrio
That's a post! Dress your offer for success!
Oct 13, 2019 04:10 PM
Margaret Goss
Baird & Warner Real Estate - Winnetka, IL
Chicago's North Shore & Winnetka Real Estate

#3 has been drilled into us! Our purchase contract is now 13-pages long (it was just 4 pages when I started in 1998) and you would think it contains everything. 

But it doesn't and the urge to add a tiny line to the contract is strong - but DON'T DO IT! It's a legal document - and as SMART as we are - we're not attorneys.

Oct 13, 2019 03:39 PM
Candice A. Donofrio
Yep. Don't add something that would negate something else.
Oct 13, 2019 04:11 PM
Sharon Tara
Sharon Tara Transformations - Portsmouth, NH
New Hampshire Home Stager

Congratulations on the well deserved feature. Amazing that some "professionals" don't always make the best professional decisions.

Oct 14, 2019 06:16 AM
Candice A. Donofrio

Thank you! And yup!

Oct 14, 2019 06:22 AM
Dorie Dillard Austin TX
Coldwell Banker Realty ~ 512.750.6899 - Austin, TX
NW Austin ~ Canyon Creek and Spicewood/Balcones

Good morning Candice A. Donofrio ,

I'm so glad that Kathy Streib featured your post in her "Ah-ha" moments for the week. I've never understood an agent not taking the time to write a clean, concise offer. In Texas we have an Addendum for EVERYTHING! no need to add anything! With multiple offers in many transactions the well written, clean offer sends a message of how the transaction will go!

Oct 14, 2019 06:45 AM
Candice A. Donofrio

The way someone does something = the way they will do everything. A poorly written document is a tell.


I hope you are doing OK, pretty lady.

Oct 14, 2019 06:59 AM
Michael Jacobs
Pasadena, CA
Los Angeles Pasadena 818.516.4393

Hello Candice:   competence matters. Try risking rejection for something you did or did not do properly. Especially for a property your client wanted. Could you live with yourself?  Sadly we each can likely tell a story where this has happened and the "blame" is missing.  Too bad.

Oct 14, 2019 12:21 PM
Candice A. Donofrio
We see it over and over again where the agent is actually in their client's way. And this is why consumers sometimes prefer dual agency.
Oct 14, 2019 12:47 PM
Jan Green
Value Added Service, 602-620-2699 - Scottsdale, AZ
HomeSmart Elite Group, REALTOR®, EcoBroker, GREEN

It's critical to write a good contract.  We are a non-judicial state so oftentimes my coutner offers include fixing mistakes!  So I get to be the judge and jury for my clients.  Very frustrating!

Oct 14, 2019 08:48 PM
Candice A. Donofrio

My counters ALMOST ALWAYS are 'housekeeping items' and of course I'm your AZ homie! I'm totally OK with that because at least it makes it right. But I'd prefer that it be right outta the gate!

Oct 15, 2019 05:50 AM
Lyn Sims
RE/MAX Suburban - Schaumburg, IL
Schaumburg Real Estate

huh, since the invent of DocuSign I rarely see a hand written contract. In fact, I truly can't remember when!

Has to be clear & clean. Before DocuSign, I used to type them.

Oct 15, 2019 11:58 AM
Candice A. Donofrio
Rare, thankfully!
Oct 15, 2019 12:55 PM
John Juarez
The Medford Real Estate Team - Fremont, CA
ePRO, SRES, GRI, PMN

Our contract forms are standard forms provided by our State Association (in most cases). We fill in the significant blanks with pertinent information and those that are insignificant with n/a. Our broker is a smart guy who wants to stay out of trouble. He personally conducts contract classes twice per year. He is an excellent teacher. I have been in business for over 20 years and I still attend our broker’s classes as do our Team members and our transaction coordinator and our listing manager. We have had other brokers thank us for well, correctly written offers and we know that it helps our success rate and our image among other brokers.

Oct 15, 2019 05:11 PM
Debra Leisek
Bay Realty,Inc Homer Alaska - Homer, AK

Excellent points! Clean Contracts make for clean transactions. ANd I love the Signed Sealed Delivered Stevie Wonder Icing on the Cake Ending!!

Oct 15, 2019 11:45 PM
Debe Maxwell, CRS
www.iCharlotteHomes.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
The right Charlotte REALTOR!

Oh boy! You're preaching to the choir here, Candice! 

You know, if we are in a bidding war, I can guage what kind of transaction we will have with each Offer that is presented - by the way it is presented! I know you know what I'm talking about too! Those who are lazy and do it half-a$$ are going to be the ones who won't f/u with paperwork when it's due or answer their phones when you need to relay something to them. 

Great post, Candice - one that should be read by ALL first-year agents!

Oct 16, 2019 08:23 PM

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