REAL ESTATE PURCHASE AGREEMENT
PURCHASE AGREEMENT dated this day of , 20 by
(individually/collectively) as "Seller" whose mailing address is
, and , as "Buyer"
whose mailing address is .
1. THE PROPERTY. The parties hereby agree that Seller will sell and Buyer will buy the
following Property, located in and situated in the County of , to wit (enter legal
description):
Unless specifically excluded, all other items will be included, whether or not affixed to the
Property or structures. Seller expressly warrants that Property, improvements, building or
structures, the appliances, roof, plumbing, heating and/or ventilation systems are in good and
working order and that Seller owns such Property free and clear of any encumbrances except
those specifically stated herein. This clause shall survive closing of title.
2. ENCUMBRANCES
a.The Property will be transferred subject the following liens:
SELLER WARRANTS that this/these is/are the only encumbrance(s) burdening the Property
and any others unrecorded or undisclosed by Seller, including any unpaid bills that would give
rise to a mechanic's lien, statutory lien, or other attachment, and such undisclosed debts shall
be paid in full by Seller upon notice and Seller does hereby indemnify Buyer for any and all
costs and fees associated with such encumbrances.
If such encumbrances are not paid at Closing, Seller shall execute any and all necessary
documents including but not limited to a limited power of attorney given to Buyer or its
agent, authorization to release information to Buyer or Buyer’s agent and other documents
necessary for Buyer to service the loan if Buyer so chooses.
b. Buyer will pay only the purchase price for the Property and will not assume or pay off
any liens
or underlying loans or other debts unless specifically stated in this agreement. Seller
understands that any debts or liens now on the Property, if not paid off or satisfied may still
be the Seller’s responsibility.
3. PURCHASE PRICE AND EARNEST MONEY.
The total purchase price to be paid by Buyer will be $ paid as follows:
Earnest money deposit* $
Loan payoff (approximate amount) $
Approximate Existing 1st Mortgage $
Amount to cure loan default (if any) $
Seller financing if any*** $
Balance Due to/from Seller at Closing $
To be paid into escrow with (escrow agent).
** All lien amounts are estimates based upon Seller’s disclosures and are subject to change.
The Parties agree that the purchase price and credit may be adjusted to reflect the actual
principal balance, including outstanding payments due on the loan but in no case will the
purchase price be higher than the credit for taking the Property subject to the existing loan.
In the event that the existing balance of the liens taken subject to are less than as stated
herein, the purchase price shall be reduced accordingly, and any cash due seller at closing
shall be reduced.
*** Seller financing, if any, shall be a non-recourse note and deed of trust or mortgage to
seller which shall be a lien junior to all existing liens on the Property at Closing, and shall
be prepared by purchase in advance of Closing for Seller to review containing the following
terms:
AMORTIZATION. Payments amortized over years in the principal amount of $
bearing an interest rate of % per annum and requiring monthly payments of principal and
interest in the amount of $ per month. Late payments beyond the day of the month
shall bear a penalty of %.Balloon date (if any) shall be on 20 .
The purchase price shall include any and all of Seller’s rights to the current tax or insurance
escrows and this amount shall not be credited to Seller at Closing.
4. INSPECTION AND MARKETABLE TITLE
a. Inspection. Buyer shall have the right to inspect all aspects of the Property,
including, but not limited to, the physical condition of the property, the value of the
property, the title, the encumbrances and any matters not shown by public record and
shall have the right, up to the time of Closing to terminate this Agreement for any reason,
in the Buyer's sole discretion. Upon such termination, all things of value given by Buyer
shall be returned and the parties will have no further rights against each other with respect
to this Agreement.
b. Damages to Premises. Seller warrants that when the sale is closed the
improvements, if any, on the Property will be in the same location and condition as they
are in on the date this Agreement is signed by Seller, natural wear and tear being
excepted. However, should the premises be destroyed or substantially damaged before
the Closing, then at the election of the Buyer, this Agreement may be cancelled; or Buyer
may schedule and complete Closing and Seller shall assign any rights to any insurance
proceeds or other claims or rights accruing before or after the transfer of the General
Warranty Deed. This section shall survive Closing.
c. Marketable Title. Seller agrees to furnish at Closing marketable title to said
Property and agrees to convey said Property by Warranty Deed to Buyer at Closing,
subject only to the following liens:
5. EARNEST MONEY AND DEFAULT.
a. Earnest money in the amount of $ shall be paid, at the sole discretion of Buyer,
in good funds or as a promissory note to Seller.
b. If the transaction contemplated hereby fails to close solely due to a default by Buyer,
the party shall have any further liability or obligation hereunder. This section shall
apply also in the Deposit, if any, shall be retained by Seller as liquidated damages
hereunder; thereafter, neither event that no earnest money was required by the Seller
modified only in that no money shall be retained.
c. If the transaction contemplated hereby fails to close due to a default by Seller, the
earnest money shall be returned to Buyer, without prejudice, however, subject to the
right of Buyer to pursue all legal and equitable remedies available to Buyer,
including, but not limited to, specific performance which will be an action to force
the sale of the house under the terms of this Agreement.
6. CLOSING. Closing shall occur on or about , 20 . Seller shall deliver at
closing a General Warranty Deed subject only to those liens and encumbrances
specifically set forth herein and a title policy and any other requested documents. Buyer
shall pay any and all costs of such policy and the Closing costs for the transaction. Seller
shall pay all utilities to the date of possession and any escrows shall be assigned to Buyer.
No later than the end of closing on the Closing date defined herein, Seller shall surrender
possession to the Property in broom clean condition and free of all personal items and
debris. Seller agrees and understands that any personal property left on premises will be
considered trash and will be disposed of without consideration to Seller. If Seller remains
in possession after closing date and time, Seller shall be subject to removal by eviction
proceeding.
7. SELLER HAS NO RIGHTS TO PROPERTY UPON CLOSING. At closing, Buyer
shall fulfill its duties under this Agreement upon the payment of all monies, less any
credits, due to Seller or to an escrow agent. Buyer shall have the right to claim full
ownership of the Property and at that time Seller will disclaim any right to ownership to
the Property. Seller shall have no right to possession or repurchase of the property at a
future time, and Buyer has made no representations, oral or in writing, express or implied,
that seller may have the option or right to re-purchase the property at a later time.
8. ACCESS. Buyer shall be entitled a key and be entitled, upon no less than 24 hours notice
to access to inspect, show other parties, including, but not limited to, partners, lenders,
inspectors and/or contractors prior to Closing. Buyer may place an appropriate sign on
the Property prior to Closing for prospective tenants and/or assignees.
9. ASSIGNMENT. Buyer may assign, without limitation this Agreement to any person or
entity prior to Closing. Buyer may, at Buyer’s option, give notice to Seller within 48
hours of Buyer’s intent to assign this Agreement, and if Seller does not object in writing
to such assignment, Buyer shall have no further duty to Seller under this Agreement.
Assignment may also include Buyer taking title at closing in a different entity or trust as
indicated in this Agreement, and Seller acknowledges, agrees and understands that by
Buyer taking title in a different entity or trust, it us an assignment of this Agreement as
stated above, and Buyer need not give Seller notice of any assignment prior to closing.
10. DUE ON SALE DISCLOSURE. Seller also understands that ANY existing security
instrument (mortgage or deed of trust) not discharged or satisfied at transfer of title
by the Buyer may have a “due on sale" clause that may be exercised by the lender.
The owner of the security instrument may, by right, choose to accelerate the loan
and demand full payment from Seller for the amounts due under the loan. Buyer
makes no promise, claim or representation that Buyer will discharge or assume
liability for said obligations that are secured by said security instruments in event
of such acceleration. In the event that said lender does accelerate said loan, Buyer
may, at his option transfer title to the property back to seller by quitclaim without
recourse, but is not required to do so.
11.SELLER’S ACKNOWLEDGMENTS (seller must initial below to each paragraph).
a. Seller understands that in engaging in this transaction Seller is giving up any
equity that may exist in the property or any proceeds that may ensue from the sale of
property, and is waiving all rights he/she/they may have under state law for cure or
redemption of the property if the property is in foreclosure or otherwise in default.
(Seller’s initials)
b. Seller understands that Buyer is not acting as an agent or representative of
Seller. Additionally, this Agreement in no way should be understood to create a
partnership, joint venture, fiduciary, consultant, or any other business relationship
between the parties except that of buyer and seller. Before signing this Agreement,
Seller has been advised and given the opportunity to seek such advice before and
after execution.
(Seller’s initials)
c. Buyer is authorized to keep and maintain insurance in place covering the
Property upon COE and the Buyer can be added as an additional insured under
existing policy or can secure new or additional insurance.
(Seller’s initials)
d. Seller acknowledges that Buyer may not be buying this Property to live in, but
rather for investment, and may make a profit from this transaction in the renting or
resale of the property, and Seller is satisfied with Buyer making and keeping all
profits in doing so.
(Seller’s initials)
e. Seller understands that he/she cannot deduct mortgage interest paid by Buyer,
even though he/she may continue to receive a form 1098 from the underlying
lender(s).
(Seller's initials)
f. Seller understands that while he/she is transferring full and complete
ownership of the Property to Buyer, the underlying loan obligation is still his/her
obligation and will continue to appear on his/her credit report until it is paid off.
Unless stated in writing in this Agreement, Buyer has made no promises or
agreements to Seller that Buyer will pay off the underlying loan prior to its maturity.
(Seller's initials)
g. Seller understands, acknowledges, and agrees that any insurance proceeds
related to any loss on the Property occurring after COE shall be paid to Buyer. Seller
shall not be entitled to receive any insurance proceeds for any loss on the Property
occurring after COE.
(Seller’s initials)
h. Seller acknowledges and agrees that Seller has reviewed and understands the
disclosures made to Seller regarding the "Subject To" sale of the Property to Buyer,
that selling the Property to the Buyer is in Seller's best interest and agrees to be bound
by the terms of the Contract and all addendums thereto.
(Seller’s initials)
12. ENTIRE AGREEMENT.. This Agreement, together with other documents
contemplated hereby constitute the final written expression of all of the agreements
between the parties, and is a complete and exclusive statement of those terms. No
addition to or modification of any provision of this Agreement shall be binding upon
any party unless made in writing and signed by all parties. Seller understands that seller
has no right or option to re-purchase or live in the property once ownership has been
transferred to Buyer, and Buyer has made no representations, oral, in writing, express
or by implication that Seller will have the opportunity to re-gain ownership of the
property.
13. GOVERNING LAW.. This Agreement has not been approved by the real estate
commission of the State of Iowa, and all questions relating to its validity, interpretation,
performance and enforcement (including, without limitation, provisions concerning
limitations of action), shall be governed by and construed in accordance with the laws
of such state.
14. SEVERABILITY. If any provision of this Contract or any portion of any provision of
this Contract shall be deemed to be invalid, illegal or unenforceable, such invalidity,
illegality or unenforceability shall not alter the remaining portion of such provision, or
any other provision hereof, as each provision of this Contract shall be deemed severable
from all other provisions hereof.
15. DEFAULT; REMEDIES.
a. Cure Period. If a party fails to comply or perform under this Contract, the other
party shall deliver a notice to the breaching party specifying the non-compliance
(the “Cure Notice”). If the non-compliance is not cured within ten (10) calendar
days after receipt of the Cure
Notice (the “Cure Period”), the failure to comply shall become a breach of this
Contract.
b. Default by Seller. If Seller shall breach any of the terms or provisions of this
Contract prior to COE, Buyer may proceed against Seller for any claim or
remedy the Buyer may have in law or equity, which includes, but is not limited
to, specific performance and/or damages.
c. Default by Buyer. If Buyer breaches this Contract, Seller accepts the Deposit
as Seller’s sole right to damages.
d. Attorneys’ Fees. In any lawsuit and arbitration proceeding involving Seller or
Buyer arising or in any way relating to this Contract, the prevailing party in such
lawsuit or arbitration proceeding shall be awarded its reasonable attorneys’ fees
whether incurred prior to or after the filing of such lawsuit or arbitration,
attorneys' fees incurred to enforce this Contract, other fees, expenses and costs
to enforce this Contract, litigation and arbitration costs, arbitration fees, and
expert fees.
16. TIME IS OF THE ESSENCE. Time is of the essence with respect to the performance
of all
terms, conditions and provisions of this Contract. All time periods set forth in terms of
“days” refer to calendar days, unless otherwise specified as business days. Whenever
notice must be given, documents delivered or an act done under this Contract on a day
that is not a business day, the notice may be given, document delivered or act done on
the next following business day. As used in this Contract, the term “business day” shall
mean a date other than a Saturday, Sunday or legal holiday observed by Escrow Agent.
17. CHOICE OF LAW. This Contract shall be governed and enforced under the laws of
the state where the Property is located without regard to any conflict of law provisions.
18. MEMORANDUM OF CONTRACT. Seller agrees that Buyer may execute,
acknowledge and record a memorandum of this Contract in the form attached hereto
as Exhibit B"(the "Memorandum of Contract"), and, in the event Buyer elects to
execute, acknowledge and record the Memorandum of Contract, Buyer shall execute,
acknowledge and deliver to Escrow Agent a notice of termination and quitclaim deed
of any interest in the Property. In the event the Memorandum of Contract is delivered
to Escrow Agent for purpose of recording, Escrow Agent shall record the
Memorandum of Contract in the Official Records of the County upon instruction from
Buyer. Escrow Agent shall, upon proper cancellation or termination of this Contract
and without further instruction from the Parties, record the Notice of Termination in
the Official Records of the County.
19. ADDITIONAL TERMS. If there is a conflict between these Additional Terms and
Conditions and any other term or condition in this Contract, then the Additional Terms
and Conditions shall control.
IN WITNESS WHEREOF, Buyer and Seller have executed this Contract as of the dates
written below.
APPROVED AND ACCEPTED BY SELLER
on :
SELLER:
Name:
Phone:
Email:
SELLER’S SPOUSE (if applicable):
By signing below, Seller’s spouse hereby
consents to this Purchase Contract and Escrow
Instructions and all addendums thereto.
Printed
Name:_
Date:
APPROVED AND ACCEPTED BY BUYER
on :
BUYER:
Name:_
Phone:_
Email:

EXHIBIT A
(Legal Description of Property, If Applicable)
EXHIBIT B (FORM MEMORANDUM AND NOTICE OF PURCHASE CONTRACT)
When recorded, return to:
________________
________________
________________
________________
MEMORANDUM AND NOTICE OF PURCHASE CONTRACT
THIS MEMORANDUM AND NOTICE OF PURCHASE CONTRACT (this "Memorandum") is
made as of the ____ day of __________________, 20___, by with
__________________________________________________________________________
____________________________________ ("Buyer") to provide notice of its Purchase Contract
_____________________________________________________________________as "Seller".
1. Buyer and Seller entered into that Purchase Contract and Escrow Instructions effective as
of _____________ ___, 20___ (the "Purchase Contract"), whereby Seller provided Buyer with the
right to purchase the real property legally described in Exhibit "A" attached hereto and
incorporated herein by this reference (the "Property").
2. This Memorandum is being recorded in the Official Records of for the purpose of providing
notice of the rights of Buyer to purchase the Property and is not intended to amend the Purchase
Contract.
3. A fully executed copy of the Purchase Contract is in the possession of each of the parties
hereto and in the possession of __________________, as Escrow Agent, at the following address:
[TITLE COMPANY NAME]
[ADDRESS]
[ADDRESS]
Attn: ______________________
4. In the event that the Purchase Contract is properly terminated, Escrow Agent is authorized
to record a Quit Claim Deed and Notice of Termination of Purchase Contract, which Quit Claim
Deed and Notice of Termination of Purchase Contract has been executed by Buyer and delivered
to Escrow Agent simultaneously with the execution of this Memorandum.
[Signatures follow.]
IN WITNESS WHEREOF, this Memorandum has been executed as of the day and year first above
written.
"BUYER"
[NAME]
___________________________________
By: _______________________________
Its: _______________________________
STATE OF )
)ss.
County of )
The foregoing instrument was acknowledged before me this ____ day of ___________, 20___ by
__________________, as a _______________ of [NAME OF BUYER] on behalf of the company.
Notary Public
My Commission Expires:
EXHIBIT A
(Legal Description for Memorandum and Notice of Purchase Contract)
TO BE SUPPLIED BY ESCROW AGENT