As the old saying goes, “Having a roof over your head is one of the necessities of life.” However, with changing times and increasingly busy lifestyles, most people find it easier to rent a place than to buy it. While renting a place may seem like the most comfortable option at the moment, buying a home is a permanent and convenient long-term solution. Buying a home can be stressful and complicated. Therefore, one should read the terms and conditions of all documents carefully before making an official investment in the property. An essential document for buying a home is the property sale contract.
What is a home purchase agreement?A home purchase agreement or home purchase agreement is essentially a legally binding contract between a buyer and seller that sets out terms and conditions that protect the interests of both the buyer and seller. This document also includes the purchase price that was set and is an excellent resource to help the sale go smoothly. To make things easier for homebuyers, here is a list of the five important items to include in the agreement.
1) Compensation clauseThis is a critical condition that the seller and buyer include as a security measure to avoid any potential loss or damage. With so many people involved in buying and selling real estate, sometimes legal issues are inevitable. Therefore, the seller and the buyer carefully formulate this clause and all possible scenarios that could cause possible harm; include.
2) Penalty clauseThe penalty clause is another important clause that is binding on both the buyer and seller. Since the purchase of the property is a matter of land and money for both parties, it is only fair that a fine amount be applied to everyone who withdraws from the deal for any reason. Also Read - NBFCs and their Impact on Real Estate in India
3) The right to cancel the agreementAfter the penalty clause is discussed, the "right to cancel" is a requirement for home buyers. As a buyer, it is essential that you reserve the right to withdraw from the transaction under certain circumstances without incurring financial penalties for doing so. Some of these conditions could be as follows:
- a) If the bank loan is not approved.
- b) If the seller does not provide the legal or legal documents for the property.
- c) If the seller did not present all the legal documents at the time of granting the deed of sale.
- d) If the buyer finds a default in the property before granting the deed of sale.