Purchase and Sale of Residential Real Estate - Contract
N.J.S. 25:1-11:Writing requirement, conveyance of an interest in real estate;
N.J.S. 45:22A-26b: Registration of development; delivery to purchaser of current public offering statement; right to cancel contract after execution; notice;
N.J.A.C. 11:5-6.2: Contracts of Sale, leases and listing agreements
Contract
The purchase and sale of residential real estate begins with a contract. A contract is a written legal document that contains an agreement between a buyer and a seller of real estate to transfer a specific piece of real property for a specific amount of money.
In New Jersey all contracts transferring ownership of real estate must be in writing. The contract must:
- Contain the names and addresses of the persons involved in the transaction;
- Contain a description of the real estate being transferred;
- Contain the type of the ownership interest being transferred;
- Be signed by both the buyer and the seller.
In New Jersey, contracts prepared by real estate brokers and signed by the buyer and seller are not legally binding for three business days from the date the buyer and seller receive a signed copy of the contract.
- During the three-day attorney review:
- Either the buyer or seller can cancel the contract.
- The terms of the original contract can be changed or new terms can be added by written agreement of the buyer and seller.
- If the contract is not changed or canceled after three business days, it becomes a valid contract.
- If the contract is changed during attorney review, it does not become final until the contract and any written additions (called riders) are agreed to and signed by the buyer and the seller.
Contracts prepared by attorneys, or by the buyer and seller themselves, may be valid immediately after being signed.
- When the seller is a real estate developer, the buyer has a right to cancel the contract for any reason within seven days after signing.
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