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Valuable Real Estate Purchasing Tips

Perhaps the most important process of buying or selling your home is the “contract of purchase and sale”. This one contract must be the strongest link in the chain that holds your purchase or sale together. The intent of each item included in this contract must be clear with no misunderstandings. In other words, everyone understand what to do and when to do it.

The “contract of purchase and sale” has been developed by the B.C. Real Estate Association and the Canadian Bar Association within British Columbia. This contract is mostly suitable for residential real estate and should not be used for commercial transactions. One major issue in the contract of purchase and sale that is often over looked is the numbering of pages. The approved contract and all ammendum pages should be cross referenced. The appropriate page number should be written at the top of each page (i.e., Page 1 of 3, or Page 2 of 3 and so forth).

An amendment to an original contract of purchase and sale is essentially known as a change in the agreement. This new agreement that has been made should be put in writing in what as known as an “addendum form” and signed by all the parties to the contract. Each of these parties much receive a copy and this copy must be dated appropriately. The amendment done on the addendum form must clearly refer to the original contract and “all other terms and conditions remain the same” should be in writing after the change.

Are you out of the country or out of the province? The seller or buyer may appoint someone (realtor or another person) to act on his or her behalf with regards to any real estate transaction. This authorization should explain the exact terms and conditions under what authority the person has to sign on an agreement. For example: A telegram, letter or fax may be perfectly fine for this person to sign for. However, the signing of legal binding agreement may need the signature of “power of attorney”. When a person is granting the power of attorney to another individual, the proper way to complete this is as shown. However, should not be taken as legal advice and should not be used without first consulting your lawyer.

“ First-Name Last-Name grants a power of attorney to her friend First-Name Last-Name to enter into contracts for the sale of his/her property.” This friend could then sign both the listing contract and any other contracts including the contract of purchase and sale. This agreement should be witnessed by another person. This should be done on the correct form provided by your lawyer of choice. Legal Counsel is recommended that all parties to a transaction be advised to have legal advice from separate lawyers.

“Subject to” Clauses in the purchase of your new home, condo, apartment or mobile home is a very important binding element of your agreement. If one or both parties are not clear, this can weaken your agreement and could alter the original intentions of the purchase and sale. The ideal subject clause is one whose criteria are so clear that it is completely obvious whether the criteria for satisfying that clause are met. When your looking at your clauses consider this. Is your clause subjective or objective? Here’s the difference:

A subjective – Is one that depends on the personal view of the individual who decides it.

An Objective – (in contrast) Is an objective clause that depends on the external event.

The more subjective the wording of a subject clause, the higher the chases the court system in British Columbia will find the clause to be uncertain. So how do you make your clause more objective? Make it clear so that everyone may easily know whether the clause is fulfilled or not. The more objective it is, the more you can prove whether the subject clause is completed or not.

Your local realtor is required to take a course on proper contractual writing and should have an innate knowledge of the law. If you have questions, don’t only present your questions or concerts to your realtor, but your lawyer as well. For the most part the experience of your realtor and the requirements put forth by the BCREA (British Columbia Real Estate Association) should be sufficient. In conclusion the be sure that all pages are numbered, the addendum is clear with signatures and that your “subject to” clauses are clear and objective.


About the Author: Shane Toews is a Licenced Realtor who helps others to educate themselves about current real estate issues. He also provides assistance on how to find quality homes, apartments or vacation rentals in Canada's Fraser Valley area.


Visit his website RentFraserValley.com for more information on Fraser Valley Homes and Apartments for Sale or Rent




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