Agreement of Purchase and Sale
The Agreement of Purchase and Sale is used to state the Buyer’s desire to purchase a property and to negotiate the terms of the sale. It allows the Buyer a chance to outline in detail all of the conditions or terms they wish to be placed in their offer. Once presented to the Seller, the Seller has a few options. This process may go back and forth a few times in an agreement to reach an agreement.
This agreement identifies:
– The Buyer and Seller legal names and legal identities of the property.
– The Buyer includes a deposit with the offer to show their sincerity to the Seller. The deposit is considered part of the purchase price and is adjusted as a credit to the Buyer upon closing.
– Irrevocability is the deadline that a person making an offer gives to the other party to accept. If the offer is not accepted within the stated time, the offer is null and void and neither party are bound to the transaction.
– Completion date is the date that the transaction is scheduled to be complete and the property is to be vacant (this is not to be a weekend or a holiday)
– Notices are sent between the parties through the sales representatives (unless in multiple representation)
– Chattels included are items separate from the property that you wish to include in the offer.
– Chattels excluded are any fixtures that are attached to the property that the Buyer and Seller have agreed will not be included in the deal.
– Rental items (hot water tank, alarm system, water treatment systems) need to be itemized and further details provided (contracts, fees etc.) as these are not included in the purchase price as they are being rented.
– Title Search date provides time for the Buyers lawyer to do the necessary searches such as checking title to ensure there are no outstanding work orders.
– Future Use is no guarantee of how the future use of the property can be determined without further investigation by the Buyer. Ie. The buyer is buying a single family home, therefor there is no guarantee in 3 years the Buyer can operate a business from the home.
– The buyer is entitled to good title but must accept the title subject to any easements for utility companies, phone, sewers or any related service. The buyer has to accept the title and any restrictive covenants as long as they are complied with. If there are any municipal agreements, zoning bylaws, or utility contracts the buyer must assume them.
– The Seller agrees to provide the Buyer any documents they have, however the Seller cannot provide for documents they don’t have. The discharge of the mortgage must be paid out and discharged upon closing (this is done through your lawyer)
– The Buyer is given an opportunity to do a personal inspection of the property they are purchasing unless it states in the body of the offer the Buyer has declined to have a professional home inspection done on the property.
– The Seller must take care of the property until closing and is responsible for maintaining fire insurance until closing. If there is a fire before transfer of ownership, the Buyer has two choices, they can either take the insurance money paid to them and take it as is or not buy the property.
– By signing this you are acknowledging that you have not signed a listing or commission agreement with any other brokerage or real estate agent for the sale of this property.
– The Buyer takes responsibility to pay for the preparation of their own mortgages and the land transfer tax while the Seller is responsible for preparing a Deed to transfer at the Sellers expense.
– Certain applicable charges such as taxes and utilities, are adjusted on closing day and the Buyer assumes responsibility on closing day.
– The property may be re-assessed on an annual basis. The Buyer and Seller agree that the salespeople cannot be held responsible for any changes.
– To complete the transaction the Buyer must produce the funds and the Seller produces the transfer of deed and the keys
– No spouse has claim to the property other than the spouse consented to the contract.
– The seller while living on the property has not used UFFI (ureaformaldehyde foam insulation and is not aware of that kind of insulation ever having been used on the property
– It defines who will be referred to as the Buyer and Seller throughout the agreement.
– The buyer acknowledges that a personal or credit check may be obtained in connection with this transaction.
– If there is any conflict or discrepancy between the pre-set portion of this form and any provisions added they will supersede the pre-set portion and that no other agreements have been made other than what is contained in this agreement.
– In the event one of the parties to the Agreement dies, their successors, heirs, or executors are bound by this agreement.
Along with the offer a document called the Confirmation of Co-operation and Representation must be complete.
Confirmation of Co-operation and Representation
This is used to define the relationship between all parties and defines the specific relationships that exist in this transaction.
– It declares in writing that your Sales Representative is insured by REBBA 2002 (Real Estate and Business Brokers Act, 2002)
– The relationship of the Listing brokerage is defined as representing the Seller and is not representing the Buyer or is providing Customer Service to the Buyer or is in multiple representation (where the listing brokerage represents both the Buyer and Seller in this transaction and consent is required. – Money and motivation are kept confidential in this transaction.
– The relationship of the Co-operating brokerage either represents the interests of the Buyer or is providing customer service to the buyer.
– The commission is stated as per the MLS information provided by the listing brokerage, if different it needs to be indicated.