A guaranteed-sale contract, also known as a guaranteed-purchase contract, is an agreement between a real estate agency and a property owner. In this contract, the agency commits to purchasing the property at a predetermined price if it remains unsold after a specified period. Typically, this guaranteed price is lower than the property's listed price.
This term is primarily used in real estate transactions. It provides a safety net for property owners, ensuring they have a buyer if their property does not sell within the agreed timeframe. This type of contract is often utilized in residential real estate, where sellers may be apprehensive about the market conditions. Users can manage these agreements with the help of legal templates available from resources like US Legal Forms.
Here are a couple of examples of abatement:
Example 1: A homeowner lists their property for $300,000 with a real estate agency. They enter into a guaranteed-sale contract that states if the property does not sell within six months, the agency will buy it for $270,000.
Example 2: A couple wishes to sell their home but is concerned about market fluctuations. They sign a guaranteed-sale contract with a local agency, ensuring they can sell their home for a minimum price if it doesn't sell in the usual timeframe. (hypothetical example)
| State | Variation |
|---|---|
| California | Guaranteed-sale contracts must comply with specific state regulations regarding disclosures. |
| Texas | Agencies may have different practices regarding the guaranteed price calculation. |
This is not a complete list. State laws vary, and users should consult local rules for specific guidance.
| Term | Definition | Key Differences |
|---|---|---|
| Listing Agreement | An agreement to list a property for sale with a real estate agency. | Does not guarantee a sale; simply allows the agency to market the property. |
| Purchase Agreement | A contract between a buyer and seller for the sale of property. | Involves a specific buyer rather than a guarantee from an agency. |
If you are considering a guaranteed-sale contract, evaluate the terms carefully. Understand the guaranteed price and duration. It may be helpful to consult with a real estate attorney or use legal templates from US Legal Forms to ensure all aspects are covered. If your situation is complex, seeking professional legal advice is recommended.
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If your property sells before the guaranteed period, the contract is void, and you do not need to sell to the agency.