When you formally agree on a price to buy a house or a condo, and the seller has accepted your offer, you’re now officially the buyer. But it’s not a done deal yet.

What does under contract mean?

Legally in Florida, real estate brokers including Lang Realty agents have standard residential contracts. The terms include specific procedures and timelines that must be met by buyers and sellers. They range from an offer to buy and the offer acceptance, to proof a mortgage or funds are available. Here's a link to the Florida Bar and Florida Realtors association “as is” contract.

What happens when a house is under contract?

The initial deposit is held in escrow. The contract is contingent on approval of a conventional, VA, FHA or other mortgage loan for purchase of the property before a closing on the transaction can be scheduled.  

How long can a house be under contract?

According to the contract, “if the buyer is unable to obtain loan approval within the loan approval period, or cannot timely meet the terms of loan approval…the buyer may terminate the contract by delivering written notice of termination to the seller prior to expiration of the loan approval period. If the buyer fails to timely deliver any written notice prior to expiration of the loan approval period, then the buyer shall proceed forward. However, the seller may elect to terminate this contract by delivering written notice of termination to the buyer within 3 days after expiration of the loan approval period and, provided the buyer is not in default under the terms of this contract, the buyer shall be refunded the deposit, thereby releasing the buyer and seller from all further obligations under this contract.

Posted by Lang Realty Blog on
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