Prepared by the lawyers of the vendor, a Contract of Sale of Property is the official document through which the potential buyer makes an official bid to the seller. In effect, the Contract of Sale of Property is considered as representative of the final agreement between seller and buyer, as well as forming the basis of the whole transaction between the two parties. Therefore, the Contract of Sale of Property must be drawn up with the outmost care and attention to detail.
Information contained in the purchaser’s bid is used to draw up the Contract of Sale of Property, and the final document is sent to the purchaser for checking. It’s advisable that the purchaser consults their legal representative before signing the document.
As it needs to address multiple issues, a Contract of Sale of Property is usually a lengthy and detailed document. To simplify matters, many states now require a standard form be used for all transactions. However, irrespective of whether a custom agreement or a standard form is used, a Contract of Sale of Property should contain certain basic information as well as addressing certain issues. Following is a rough outline of the details that need to be included in a Contract of Sale of Property in Cyprus.
1. The Parties
This section of the document should contain the name and address of both seller(s) and purchaser(s), details of the agent or broker, corporate status, marital status as well as ownership interest of multiple sellers and ownership interest of multiple buyers.
2. Property description
This section of the Contract of Sale of Property contains information regarding legal description, encumbrances, (in simple terms claims against a property by another party such as an outstanding mortgage or unpaid property taxes) as well as improvements. All personal property should also be included.
3. Purchase Price
Understandably, within this section of the document all details regarding the financial side of the agreement should be included. These include the amount, down payment or earnest money, balance due, method of payment and time and place of payment of balance.
Time and form of the transaction.
This section of the Contract of Sale of Property in Cyprus is reserved for details regarding date, location, parties required/power of attorney, right to extend date, proration of taxes, utilities, interest, rent and possession. It should also include details about the document requirements, such as deed, leases, bonds and escrow (a financial instrument held by a third party on behalf of the other two parties in a transaction). This section should also include affidavits, which are documents provided by the seller stating the status of potential legal issues involving the property or the seller. The purpose of an affidavit is to protect the buyer from outstanding legal issues that might be facing the seller.
Details such as evidence, examination, abstract (a written history of all the recorded documents and proceedings related to the property), defects and objections, insurance policy and method of conveyance should be included in this section.
7. Warranties of the parties
8. Conditions of closing
This section of the Contract of Sale of Property contains information regarding inspection of the property, financing, condition precedent, risk of loss/casualty insurance, possession and time of essence.
Details regarding specific performance, liquidated damages and alternative dispute resolution
This section should include details about the identity of mortgagor, type of Mortgage, broker, commission and claims.
11. Miscellaneous provisions
The final section of the Contract of Sale of Property in Cyprus should contain all other information regarding the purchase. These include details about survival, assignability, existing tenancies, notice, severability, entirely of agreement and acknowledgment of notary public.
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