The Purchase and Sale, or P & S for short, is a multi-page document executed about 10 days from the Offer or approximately 3 business days after the Home Inspection Contingency. Both the Buyer and Seller Attorneys will work together to draft and each will add verbiage to protect their Clients.
All information from the Offer and from the Home Inspection if applicable will be included in the document. The Purchase & Sale now takes the place of the original Offer.
The second more substantial deposit will be due at the time of signing and that amount is usually 5% of the purchase price minus the $1000 already paid. For example, if a Home costs $500,000 the P & S deposit would be $24,000 ($500,000 x 5%=$25,000-$1000= $24,000) this amount should be readily available when you submit the offer since it will be due in approximately 10 days. It is certainly possible and could be appropriate to put down less if necessary, but most Sellers will want a good reason since 5% is the norm.
Many Buyers ask if there is a formal meeting with the Sellers to sign the Purchase & Sale document. The answer is no. The Purchase & Sale is first signed by the Buyer and then given to the Seller through the Agents or Attorneys for the Sellers signatures. The 2nd deposit check is also delivered at that time.
It is important to go over the Purchase & Sale with your Attorney prior to signing since it is a more complicated document to understand versus the offer. The P & S can be signed at the Attorney or your Realtors office or can then be emailed or faxed for the Sellers Signatures. To make the process easy, I will set up electronic signing for my Buyers if they prefer.
Contact Rachel Bodner to help you buy your Home and learn more about the Buying process in Massachusetts.