A real estate pre-purchase agreement, also known as a “contract to purchase” or “offer to purchase,” is a legally binding agreement between a buyer and a seller that outlines the terms of a real estate transaction. This document is often the first step in the home buying process, as it establishes a framework for negotiations and sets expectations for both parties.

If you`re in the market for a new home, it`s important to understand the basics of a real estate pre-purchase agreement and what you should look for before signing on the dotted line. Here are some key things to keep in mind:

1. The offer price: This is the amount of money you`re offering to pay for the property. It`s important to research comparable homes in the area and consult with a real estate agent to ensure that your offer is fair and competitive.

2. Contingencies: A contingency is a condition that must be met before the sale can go through. Common contingencies include a satisfactory home inspection, financing approval, and the sale of your current home. Make sure to carefully review the contingencies outlined in the pre-purchase agreement and ensure that they align with your needs and timeline.

3. Earnest money: This is a deposit made by the buyer to show that they`re serious about the purchase. If the sale goes through, the earnest money is applied to the down payment. If the sale falls through, the seller may keep the earnest money as compensation for their time and effort.

4. Closing date: The closing date is the day on which the sale of the property is finalized. Make sure that the closing date outlined in the pre-purchase agreement aligns with your schedule and any other commitments you may have.

5. Legal review: Before signing a real estate pre-purchase agreement, it`s always a good idea to have it reviewed by a real estate attorney. They can ensure that the document is legally binding and that your rights as a buyer are protected.

In sum, a real estate pre-purchase agreement is a crucial document in the home buying process. By understanding the key terms and seeking professional guidance, you can ensure that your interests are protected as you navigate this exciting but complex transaction.