| Many people might argue that investing in real estate | | | | specific events to occur before a certain obligation |
| is one of the most interesting and exciting ways to | | | | becomes fixed. That may be confusing so let me try |
| save for your retirement and create a steady | | | | and give an example. Say the purchaser wants the |
| stream of current income today. Let's face it, lots of | | | | town to approve building a new park next to your |
| people are addicted to real estate investing! I'll admit | | | | building and you refuse to purchase the building until |
| that I've been swept up myself in the past. | | | | the town has agreed to build the park. |
| One thing about real estate investing that makes it | | | | Once the town has built the park, the purchaser will |
| different than other forms of investing, such as the | | | | now be contractually obligated to purchase the |
| stock market for instance, is the fact that real | | | | building from the seller. You get the idea... these |
| estate investments are much more complicated | | | | things will be spelled out in the condition precedent |
| especially when it comes to closing the sale. If you've | | | | clause and obviously this clause won't be present in all |
| ever been to a closing then you know what I'm | | | | contracts. |
| talking about! | | | | The building permits clause is the next one I want to |
| There is a sort of mad flurry of paperwork shooting | | | | talk about. This is similar to the last clause in that you |
| out every which way. There's papers on the table, | | | | may require the seller to make sure the building |
| there's papers coming out of briefcases, there's | | | | permits are up to date or that the zoning is |
| papers on the floor, there's papers being passed | | | | approved by the city before you purchase the |
| around from you to the buyer to the seller to the | | | | building. These sorts of things will be spelled out in |
| broker to the lawyer back to you again. Initial here; | | | | the building permits clause. |
| initial there; sign here, and sign there... it can very | | | | Brokerage fees clause. Most people don't realize that |
| quickly turn into a madhouse which is why you want | | | | brokerage fees are negotiable and not only are they |
| to be as familiar as possible with real estate | | | | negotiable between you and your broker but they |
| contracts before you go into closing. | | | | can even be negotiable between you and the seller. |
| That's why I thought I'd write this article today and | | | | They state which of you has to pay the fees or if |
| explain a few simple clauses that you should expect | | | | you share the fees or any combination of the two. |
| to see in a regular real estate contract. Hopefully | | | | This will be spelled out in detail in the brokerage fees |
| you'll be able to familiarize yourself with them here | | | | clause section of your contract. |
| and therefore get a leg up when it comes time to | | | | Well fortunately I've only touched on three clauses |
| battle during closing. | | | | today in this article but hopefully at least they will |
| The first clause I want to talk about is the condition | | | | give you a heads up so that you understand a little |
| precedent clause. This basically says that the | | | | bit what to expect when it comes to real estate |
| purchaser or the seller may want one of a few | | | | contract clauses. |