Form 100: Ontario Purchase and Sale Agreement Explained
When it comes to purchasing or selling a property, there is a lot of real estate paperwork to deal with! In addition, the Ontario Real Estate Association has prepared a few common or standard forms for all real estate agents in Ontario to use when dealing with real estate transactions. One being Form 100 - Agreement of Purchase and sale.
This blog was made to help buyers and sellers better understand what this agreement includes.
So, let's get started!
What is a Purchase and Sale Agreement - Form 100?
Agreement of Purchase and Sale, Form 100 is used for freehold purchases and Form 101 is used for condo purchases, each of which has its own unique set of requirements. However, the two forms are very similar. This specific agreement is used to buy a property and to negotiate the conditions of the sale in real estate transactions. An "Offer" is a common term for this type of agreement.
For the home buyer, this real estate form gives them the opportunity to lay down exactly what they want included in their offer when purchasing a home from a seller. The Agreement of Purchase and Sale is the legal real estate document that describes the terms and conditions of your offer to purchase a property in Ontario, where a real estate transaction must be in writing to be considered legal.
Details of the Trade
A lot is covered on the first part of the form, such as the date an offer is made, the parties involved, the property information, and the amount of a down payment presented.
Tip: Keep in mind, the higher the down payment, the more serious the offer looks.
The offer is valid until the specified date, which is known as the irrevocable date. In other words, the seller has until the specified date/time to accept, counter or reject the offer.
On this day, the deal is expected to be finalized (also known as closing day). It is assumed that the property will be left empty unless otherwise stipulated in the contract. No weekend or statutory holidays should conflict with this deadline.
This portion of the agreement allows the buyer to specify which things, if any, are to be included as part of the purchase price. Appliances and other non-attached goods may be included, if the seller agrees. The objects should be explained in depth to avoid future disagreements.
If the Seller wants to remove something from the home, such as a "dining room light fixture," this must be specified in writing.
The amount of time a lawyer has to do a title search or determine if the property is encumbered by any liens.
Inspection Pre-worded Clause
This clause ensures that the buyer has had a chance to see the property in person before deciding to buy it or not. A condition clause for the examination of a property inspection report may have been added, and thus, the buyer accepts that they will not get an inspection report if the seller does not include such a clause.
Schedule A (Area for Conditions)
Most common conditions are outlined on this page, such as home inspection (conditional on the buyer getting a satisfactory home inspection), financing (gives the buyer sufficient time to get finances in order), buyer revisits (buyer is allowed to see the property x amount of times before the sale is finalized, and lastly, tidy/clean (the buyer says he or she will take care of cleaning the property).
Things to keep in mind before signing the contract of sale:
- Time limits - For example, if an agreement is set to expire at 10am on a specified date, it cannot be accepted at 10:01am because of the time constraints set forth in this agreement, which must be strictly adhered to.
- It is essential that all conversations between a home buyer and a home seller should be in writing in order for it to be legally binding.
- The Agreement of Purchase and Sale can be executed electronically, like all real estate forms and paperwork.
In order to enter the Ontario real estate market and purchase or sell a house, you'll most certainly be greeted with this paperwork and information that may seem frightening at first, but your Realtor is here to guide you through it all!
As a real estate broker, Andrew Irani is the greatest there is. With a kind and sincere demeanour, he'll walk you through each process step-by-step and ensure that all your needs are addressed. Click here to get in contact with Andrew today!