A purchase agreement — also called a sales contract, purchase contract, or contract for sale — is the legally binding agreement between buyer and seller that establishes all the terms and conditions of a real estate transaction. It is the most important document in the deal because it governs everything that happens from the moment of acceptance through closing: the price, financing terms, contingencies, deadlines, responsibilities, included items, and remedies if either party fails to perform.
Key provisions in a standard purchase agreement include: the purchase price and how it will be financed, the amount and timing of the earnest money deposit, the closing date, the type of deed to be delivered, who pays for various closing costs (this varies by local custom), what personal property is included (appliances, fixtures), contingencies and their deadlines, inspection rights, repair obligations, and default provisions (what happens if either party backs out).
Contingencies are among the most important provisions. Common buyer contingencies include: the financing contingency (the buyer must obtain mortgage approval), the appraisal contingency (the property must appraise at or above the purchase price), the inspection contingency (the buyer can inspect and negotiate repairs), and the title contingency (the property must have clear title). Each contingency has a deadline — missing a deadline can result in the contingency being waived automatically. Learn more about mortgage pre-approval timelines.
The purchase agreement also addresses risk allocation. Who bears the risk if the property is damaged between contract and closing? What happens to the earnest money if the buyer defaults? Can the seller accept backup offers? Are there liquidated damages provisions? These clauses can have significant financial implications, and both parties should understand them thoroughly before signing — ideally with the guidance of a real estate attorney.
Once executed, the purchase agreement is provided to the title company to begin the closing process. At Beycome Title, we review every contract carefully to ensure all terms are accurately reflected in the closing documents — from prorations to credits to special provisions. Our team tracks all deadlines and keeps all parties informed throughout the transaction. Whether you are selling through Beycome's flat-fee MLS service or buying with a traditional agent, we ensure your contract terms are honored at closing. Get your free closing quote.