Offers to Purchase

An offer to purchase real estate in Massachusetts is usually conveyed in writing and is a binding contract between a potential buyer and seller. In addition to price, an offer should include any other issues, contingencies, uncertainties, or details that will protect your rights while limiting your risk.

Some basic issues, but certainly not the only important ones, include: when you want the sale to take place; financing; inspections; access to the property; repairs; various deadlines; and conditions for terminating the agreement.

Offers generally contemplate the parties agreeing to negotiate and sign a separate contract which is known as a Purchase and Sale Agreement. Real estate brokers and realtors generally use a standard form and include additional forms with contingencies for various items (property inspection, financing contingency). These forms alone, however, may not suffice in covering your bases and more and more we are seeing subtle but important changes to the "standard forms."

An "offer" on a property is not to be taken lightly by either a buyer or seller. We prefer to work with buyers and sellers before they even get to the point of making or accepting an offer on real estate.

An accepted offer can be found to be an enforceable contract even without the parties agreeing on additional essential terms or protections. Whether you are buying or selling real estate, we advise you to work with an attorney from the beginning. Often an attorney is not consulted until an offer has been accepted by a seller and the parties are proceeding. If you are in the market to buy or sell, however, why wait to identify important issues you are likely to face in any real estate transaction? By having an objective advisor involved from the beginning, you will likely avoid the costs, delays, and frustrations we see many parties unnecessarily endure.

A Purchase and Sale Agreement (sometimes called a "P&S" or "P and S") is generally speaking a contract concerning the transfer of real estate. Massachusetts transactions involving a real estate agent or broker are usually contracted in document called a Standard Purchase and Sale Agreement. The standard agreement is comprehensive in the areas it aims to cover, but often there are addendums or riders attached to the agreement that contain additional provisions or clarification of previous conditions. It is also common for attorneys to adjust the language in the standard agreement itself. In this respect the use of the word "standard" may be misleading. We have witnessed many variations in the "standard" agreement, especially as brokers, real estate agents, and parties become more adept at electronic means of communication. The ability to change a term or provision here and there is readily available to anyone with a word processor. The "standard" agreement may appear standard but should be fully reviewed by those experienced with these contracts.

We advise against anyone preparing their own purchase and sale agreement or relying on the standard form. We have witnessed enough occasions where one party wanted to save a few hundred dollars in what is likely the largest financial transaction in their life only to regret it later. In addition to adding security to your purchase we are often able to offer additional value and help you find savings.

In a recent sale we advised our seller that she could be paid for the value of the oil in her oil tank. The tank had just been filled the day before and our seller left the closing with over nine hundred dollars more than she would have because of our involvement. We have worked with property owners facing potential taxes to avoid these taxes by making the correct representations at their closing or by suggesting a 1031 like kind exchange to defer capital gains tax.

Did you know that simple things like adding homestead protection to one's principal residence can be worth up to $500,000 in financial protection?

In addition we have saved deals when they began to fall apart. An example, our client was selling property and the buyer and he had reached a fair agreement on price. After several weeks, the buyer was unable to obtain the necessary financing. We suggested a lender with different loan standards and the deal went through. We've negotiated refrigerators, washers and dryers, curtains, plants, snow blowers and other items that exceed the cost of our services. This is beyond the price reductions or gains we have negotiated on larger items such as roof repairs, mold remediation, furnaces, parking spaces, electrical upgrades and others. But the most important element we provide is often the peace of mind in knowing we are watching out for your interests. This alone can deter others from trying to sneak something by.

The word "closing" generally refers to when a deal or transaction is completed or "closes." Generally ownership is exchanged for funds at the closing. The steps involved in a closing are usually managed or overseen by a "closing attorney." The closing attorney typically represents the interests of the lender but coordinates the deal between the buyer and seller. Both the buyer and seller may also have their own attorney. A "cash" transaction does not involve a financing party and the buyer is paying "cash" to the seller. Here, it is even more important for counsel to be involved throughout the transfer since there will be no third party looking out for the bank's interests under customary conveyancing standards.