What to Review Before Signing a California Purchase Agreement

General information only, not legal advice. Reading this article does not create an attorney-client relationship. Every situation depends on its specific facts.

The contingencies

Contingencies are your exit doors. Inspection, financing, and appraisal contingencies each have deadlines, and missing one can convert a refundable deposit into a forfeited one. Understand exactly what you must do, by when, to keep your protections alive.

The deposit and liquidated damages

California agreements commonly cap a seller's damages at the deposit if the buyer defaults and the liquidated damages clause is initialed. Know what you are risking and under what circumstances it can be lost.

Disclosures and investigation

Sellers must disclose known material facts, but buyers still carry an obligation to investigate. Read every disclosure, ask about anything unclear, and document the answers.

Title and how you will hold it

Review the preliminary title report for liens, easements, and restrictions, and decide deliberately how title will be held. That choice has legal and tax consequences worth professional advice.

What happens if someone does not perform

Understand the remedies the agreement provides, from mediation requirements to specific performance, before you need them. The time to understand a contract is always before signing it.

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