In this situation, the short-sale addendum (TAR 1918) should always be attached to the contract in order to protect both the buyer and the seller, since there is a contractual agreement between the parties, under which each has specific performance requirements, and because the seller`s capacity under the contract is subject to the lender`s agreement. The addendum makes it clear that if the seller and buyer are executed, the contract is binding and the money earned and the option fees are payable in accordance with the contract. It is not a good idea to do so because the seller might be required to sell the property to two different buyers if both accepted the seller`s counter-offer. Instead, the seller could refuse both offers and ask interested parties to submit better offers using the seller`s invitation to the buyer to submit a new offer form (TXR 1926), or the seller could only make a counter-offer to one interested party. When a party makes an offer or counter-offer, that bias gives the power to enter into a binding contract. Negotiating a real estate transaction offers several opportunities to favour either party, not just the price. It may be advantageous to consult a real estate lawyer here. A real estate investor should always have (at least) three professionals on demand: a CPA, an insurance broker and a real estate lawyer. Real estate investors will discover that they are almost always better able to use the TREC 1-4 contract with addendum, rather than using something simpler, supposedly designed or streamlined to be used by investors – including modified contracts that result from the multitude of real estate seminars «gurus». As a result, an experienced investor becomes familiar with the various options and boxes that will be verified in TREC forms and will learn to tailor a contract to his advantage.
Second, disclosure of defects and conditions is limited to the knowledge and awareness of the seller – not at the highest level. The buyer does not care what the seller knows or says he knows, but what actually applies to the property. It`s too easy for an unethical salesman to say later, «Oh, I didn`t know.» Sometimes problems can be detected by inspections and other due diligence, sometimes not. Often, the truth is discovered only after subsequent conversations with neighbors – who perhaps rejoice in a perverse way that the seller was not only aware of the water penetration behind this fake stucco, he personally repaired and painted it to hide the damage. The buyer should want to know about such repairs and ask for the contractor`s documents to determine the extent of the work in progress, whether or not correct approvals have been obtained and whether or not there is a transferable guarantee. Overall, what a careful buyer wants is something stronger than what the seller`s disclosure offers, namely explicit assurance from the seller and a guarantee of the absence of certain deficiencies and negative conditions. Section 10 – Property: This section is devoted to the question of whether the buyer takes possession of the property immediately after closing and financing or whether a lease buyback is offered to the seller. Most home purchases transfer ownership of the property after closing and financing, but it is not uncommon for the seller to charge a rental price of 3 to 7 days to relocate once the property is closed.
An exception is a right that relates to a specific property, but is held by another person who may not be a party to the contract to sell a property or mineral interest. For example, a seller of real estate may sell the property, except that another person already owns half of the mineral shares. This other person is usually identified somewhere in the title chain. The TREC brokerage/lawyer committee has repeatedly decided not to include a reservation clause in the housing contract forms.