<h2The Purchase Agreement: Your Most Important Document</h2<pThe purchase agreement — also called a sales contract or offer to purchase — is the legally binding document that governs the sale of your home.
It specifies the purchase price, closing date, contingencies, earnest money, and dozens of other terms that determine how the transaction will proceed.
As a FSBO seller, understanding this document is not optional; it is essential.</p<h2Where to Get a Purchase Agreement</h2<pIn most states, standardized purchase agreement forms are available from your state's Association of Realtors, state bar association, or real estate commission.
Many are available for free or a nominal fee online.
These forms are drafted by attorneys and updated regularly to comply with current law.
Using a standardized form is far safer than drafting your own contract from scratch.</p<pIf a buyer is represented by an agent, their agent will typically prepare the offer using their brokerage's standard form.
You have the right to review it carefully before signing.</p<h2Key Terms to Understand</h2<pPurchase price is the obvious starting point, but the contract contains many other terms that matter just as much.
The earnest money deposit — typically 1–3% of the purchase price — is the buyer's good-faith deposit that they risk if they back out without a valid contingency.
The closing date establishes when you must vacate and transfer title.
Contingencies are conditions that must be met for the sale to proceed.</p<h2Common Contingencies</h2<pThe three most common contingencies are the inspection contingency (buyer can exit or renegotiate if the inspection reveals significant defects), the financing contingency (buyer can exit if they cannot obtain a mortgage), and the appraisal contingency (buyer can exit if the home appraises below the purchase price).
Each contingency represents a potential exit for the buyer, so fewer contingencies generally mean a stronger offer.</p<h2Negotiating the Contract</h2<pEverything in a purchase agreement is negotiable.
Common negotiation points include the purchase price, closing date, earnest money amount, which contingencies are included, who pays closing costs, what personal property is included or excluded, and the timeline for inspection and response.
Approach negotiations professionally and in writing — verbal agreements are not enforceable in real estate.</p<h2When to Hire a Real Estate Attorney</h2<pSome states require a real estate attorney to be present at closing regardless of whether you have an agent.
Even in states where it is not required, hiring a real estate attorney to review your purchase agreement is a wise investment.
Attorneys typically charge $500–$1,500 for transaction review and closing representation — a small cost relative to the transaction size and the legal protection they provide.</p<h2Conclusion</h2<pThe purchase agreement is the foundation of your home sale.
Take the time to understand every term, negotiate thoughtfully, and do not hesitate to involve a real estate attorney when the stakes are high.
A well-negotiated contract protects your interests and sets the stage for a smooth closing.</p