; North Carolina Real Estate Purchase Agreement
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North Carolina Real Estate Purchase Agreement


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									respective claims, you may sue the other party in          still go forward with the transaction. Although the              • Lead Paint Disclosure. If you are purchasing       do by mail. If you are a resident of another state, you    of law when performed by real estate agents. Since
the appropriate court to resolve them. With regard         seller may be able to recover damages from you for         a residential building constructed before 1978, federal    may also have additional rescission rights under the       these transactions may be riskier than a conventional
to any earnest money you may have paid, the real           your failure to perform by the stated date, the seller     law requires sellers and their agents to provide you       laws of your home state. The developer must hold           purchase, you should consult your attorney before into
estate agent must retain it in an escrow account           must still perform his or her obligations under the        written information about the possible presence of lead    all funds received from you in an escrow account           entering such agreements.
until you and the seller reach a written agreement         contract.                                                  paint and the associated hazards. If you are not given     for at least ten days. However, if you are purchasing            • Lease-Purchase. In lease-purchase
for its disbursement or a court resolves the dispute.                                                                 this information (and an inspection period) before         the timeshare from another consumer or through             transactions, you occupy property as a tenant but agree   Questions and Answers on:
                                                           Q: Once I have entered into a contract with the                                                                                                                                  to purchase it at a future date. There is no standard

                                                                                                                                                                                                                                                                                                       OFFER AND
Alternatively, with proper notification to you and                                                                     entering into the purchase contract and have not           a foreclosure sale, there is no rescission period or
the seller, the agent may remit it to the clerk of court   seller, is there any way I can cancel it?                  signed a written waiver of your rights, you have a ten     mandatory escrow of payments.                              lease-purchase form available, so you are again advised
in the county where the property is located. When          A: Not without the consent of the seller unless a          day inspection period during which you may be able                                                                    to consult your attorney.

attorneys hold earnest money, they must hold or            particular law or special (non-standard) provision         to cancel the contract.                                    Q: Are there ways to purchase real estate other                  • Installment Land Sale. In an installment land
dispose of it in accordance with the rules of the          in your contract grants you a right of rescission. For                                                                than using the standard offer to purchase and              sale (also known as a contract for deed), title remains
North Carolina State Bar.                                  example, the law grants a rescission right in the                                                                     contract?                                                  with the seller while you make payments to the seller.
                                                           following limited circumstances:                                                                                      A: Yes. Here are a few:                                    Usually, the contract allows you to possess and use
                                                                • Residential Property Disclosure Act. At or                                                                          • Option to Purchase. With an option to               the property while making payments but such terms
                                                           before the time you make your offer in a residential                                                                  purchase, you have the right during the option period      are not legally required. If you are in possession of
                                                           transaction, the seller (whether or not a real estate                                                                 to buy property at an agreed upon price. For this          the property and default on your payments, the seller
                                                           agent is involved) must provide you a written form                                                                    right, you will pay option money to compensate the         can sue you to regain possession of it and is generally
                                                           disclosing certain conditions and characteristics of the                                                              seller for taking the property off the market during       entitled to retain all the money you paid under the
                                                           property. If the seller does not, any resulting contract                                                              the option period. Although subject to negotiation,        contract.
                                                           is subject to a limited right of rescission — usually up                                                              option money is non-refundable and paid directly to
                                                           to three calendar days from the time the contract is            • Condominiums. If you are purchasing a               the seller at the signing of the option. Depending
Q: The seller has accepted my offer but the                formed. You should be aware, however, that there           new condominium from a person classified by law             upon the terms of the option agreement, you may or
resulting contract requires that certain things            are a number of exceptions to this requirement.            as a developer, you have seven days to rescind your        may not receive credit for some or all of your option
(loan approval, inspections) be done by a                  Consequently, for application of this law to a             purchase contract. When the seven day period begins        money against the purchase price if you “exercise”
certain date. What happens if they are not                 particular situation, you should consult your attorney.    or ends can vary from one transaction to another, but it   your option. The standard “Offer to Purchase and
completed by this date?                                                                                               usually begins when you are given the required public      Contract” form allows the buyer to pay an “Option
A: Generally, these “conditions” and                                                                                  offering statement. During this period, all monies         Fee” in exchange for the right to terminate the contract
“contingencies” must be performed by the dates                                                                        paid by you must be held in escrow by the developer.       for “any reason or no reason.” You should read any            The North Carolina Real Estate Commission
specified in the contract or very soon thereafter,                                                                     Immediately contact an attorney for advice if you have     option contract carefully and consult your attorney if                     P.O. Box 17100
depending upon whether the contract states that                                                                       questions about your rescission rights. (For more          you have any questions.                                          Raleigh, North Carolina 27619-7100
“time is of the essence.” If time is of the essence,                                                                  information on condominiums, see the Commission’s               • Lease with Option. When a lease is coupled                            919/875-3700
and you or the seller fail to perform by the stated                                                                   brochure, “Questions and Answers on: Condominiums          with an option to purchase, you have the right to                  Web Site: www.ncrec.state.nc.us
deadline, the other party may terminate the contract.                                                                 and Townhouses.”)                                          buy property at a set price while leasing it. There
If the contract does not state that “time is of the                                                                        • Timeshares. If you are purchasing a new             are no standard forms available for this purpose.            0,000 copies of this public document were printed
essence”and, through no fault of your own, you are                                                                    timeshare in North Carolina from a seller classified by     Attempting to modify other standard forms for such                      at a cost of $.000 per copy.
unable to complete the inspections by the deadline,                                                                   law as a developer of a timeshare project, you have five    use may result in a muddled or even unenforceable
but do so within a reasonable time, the seller must                                                                   days to cancel your purchase contract which you can        contract, and constitutes the unauthorized practice                          REC 0.00 00/0/00
Questions and Answers on:                                   attorney if you do not understand any issues regarding        and all of the terms agreed upon by you and the seller.    Q: How will my offer be communicated to the                  orally by the seller or seller’s agent, by personal          — even if your offer was submitted first and is for a
OFFER AND ACCEPTANCE                                        it before you enter into a binding contract.                  It must also contain an adequate legal description of      seller?                                                      delivery of the signed offer, mail, facsimile (fax)          higher purchase price. An agent is required to deliver
                                                                 The questions raised in this publication                 the property (for example, a reference to a recorded       A: The real estate broker with whom you are working          or electronic mail. If you’re told that the seller has       all offers promptly. In order to obtain for their seller-
                                                            are of special concern to real estate purchasers.             plat map or deed) — a street address alone is not          must deliver it to the seller’s agent or directly to the     accepted your offer, ask whether the seller has signed       clients the best possible bargain, the seller’s agent will
                                                            Consequently, they are posed from the standpoint of           sufficient. There are many other important provisions       seller if the seller has no agent. The seller’s agent must   it, and ask for a signed copy of the contract. Your          usually inform competing prospective buyers that
                                                            the purchaser.                                                you should consider. For example, to assure that           present it to the seller.                                    real estate agent must furnish it to you.                    other potential buyers are interested in the property.
                                                                                                                          items or features of the property you have seen in                                                                                                                                   To treat competing propective buyers fairly, the seller’s
                                                            Q: I have found a home I am interested in buying.             advertisements or MLS information are included in the                                                                   Q: What if the seller changes my offer in some               agent usually will not divulge the price and terms of
                                                            How do I make an offer to purchase it?                        sale, you or your agent should list them in your offer.                                                                 way and then signs it?                                       competing offers. Whether you have been informed
                                                            A: Typically, you will complete a standardized offer          Any form contract supplied to you by a real estate                                                                      A: If the seller makes any changes in your original          of competing offers or not, you cannot assume that
                                                            to purchase form with the help of a real estate agent         agent must include at least eighteen separate required                                                                  offer, the offer is rejected and cannot later be accepted.   your offer will receive special consideration or that you
                                                            — probably a buyer agent. This form will express the          provisions. The standard form “Offer to Purchase and                                                                    By making changes to the original offer, the seller is,      are the only buyer who is interested in the property.
                                                            terms of the purchase (purchase price, closing date,          Contract” includes all these and many more.                                                                             in fact, making a counteroffer to you which you can
                                                            etc.) that you are proposing to the seller. The most                                                                                                                                  either accept, reject without making a counteroffer, or
                                                            common residential offer form in North Carolina is                                                                                                                                    reject and make your own counteroffer. The process
      The purchase contract is the most important           the “Offer to Purchase and Contract” (Form No. 2-T),                                                                                                                                  can continue in this manner indefinitely. You and the
document in any real estate sale. It must reflect            jointly approved by the N.C. Bar Association and N.C.                                                                                                                                 seller should initial and date all changes made during
the entire agreement between the buyer and seller.          Association of REALTORS®. Many standard “addenda”                                                                        Q: How does acceptance occur?                                the negotiation of an offer. If the offer becomes too
This brochure examines issues arising during                forms also are available to add provisions of special                                                                    A: To accept your offer, the seller must sign it without     “messy” as a result of many changes, re-type the offer
contract negotiations in residential real estate sales      importance to the parties. Your real estate agent                                                                        making any changes. Until you or your agent have             in its final form before signing it.
transactions. In particular, it focuses on “offer” and      may have a variety of these forms, but if a standard,                                                                    been notified that the seller has signed your offer, you
“acceptance”: the process by which a buyer and              preprinted form is not available covering the specific                                                                    can withdraw it at any time — even if you have given
seller create a binding legal contract. This process        terms of your offer, you should consult a private                                                                        the seller a deadline by which he or she must respond.
typically begins when a prospective buyer makes an          attorney to draft an appropriate document for your use.       Q: Must my offer include earnest money?                                                                                                                                              Q: What else might happen to my offer after I
offer. Then, the seller either accepts it, rejects it, or   Real estate agents are not permitted to draft contracts       A: Earnest money is not required to make a binding         Q: Once the seller has signed my offer, does it                                                                           submit it to the seller?
rejects it and makes a counteroffer. Then the buyer         or even special provisions such as contingencies.             real estate sales contract. However, it is a common        become a contract?                                                                                                        A: It may simply expire if you include an expiration
has the same options (i.e., accept, reject without                                                                        practice for a buyer to include it with an offer because   A: No. It does not become a binding contract until                                                                        date in the offer (or within a reasonable period of
making a counteroffer, or reject with a counteroffer).      Q: Does my offer to purchase have to be in                    it shows the buyer’s good faith, demonstrates some         the seller (or seller’s agent) has notified you (or your                                                                   time if no deadline is set). It is terminated if the seller
When one party accepts the other party’s offer              writing?                                                      available cash, and makes it more likely that the seller   agent) that the seller has signed it. If your agent                                                                       sells or contracts to sell the property to someone else.
or counteroffer, including communicating that               A: To be enforceable, real estate sales contracts in          will accept the offer. Earnest money checks must           informs you that the seller has “verbally” accepted or                                                                    Otherwise, unless you withdraw it, the offer remains
acceptance to the offering party, a purchase contract       North Carolina must be in writing. Since only written         be deposited no later than three banking days after        will accept your offer but has not yet signed it, there is                                                                an offer.
is created.                                                 offers may become binding contracts, your offer should        acceptance, but may be deposited at any time after         no enforceable contract.                                     Q: What happens if someone else makes an offer
      Any misunderstandings concerning offer and            be in writing and signed.                                     receipt. So, be sure your earnest money check is                                                                        to purchase the property before the seller accepts           Q: What happens if the sales transaction does
acceptance can result in serious legal and financial                                                                       good at the time you write it. (For more information       Q: How will I be notified of the seller’s                     my offer?                                                    not close?
consequences for the buyer and seller. Therefore, it        Q: What should be in my offer?                                on earnest money deposits, see the Commission’s            acceptance of my offer?                                      A: Until the seller signs your offer and notifies you         A: If there is any dispute between you and the
is imperative that you carefully read and understand        A: At a minimum, your offer must clearly identify you         brochure, “Questions and Answers on: Earnest Money         A: Unless the contract specifies the manner in which          or your agent that it has been accepted, the seller can      seller and you cannot agree to a resolution of your
the entire purchase contract and that you consult an        and the seller, and state the sales price, and closing date   Deposits.”)                                                acceptance is to be given, it may be communicated            consider and accept an offer from a competing buyer                                                          Continued

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