How To Understand Your Real Estate Contracts

One of the simplest and most straight forward pieces of advice I can give anyone in the process of buying or selling real estate is to read the documents and ask questions. In Colorado, the contracts and the majority of supporting documents Realtors use to manage the sale and closing of a real estate transaction have a common thread; they are typically all forms that are standardized and approved for use by the Colorado Real Estate Commission.

read-your-contract-example.jpgOne reason that’s good for you as a buyer or seller is that you can look at the completed form and easily see the difference between the ‘boiler-plate’ parts of the contract (those that are pre-written and common to all the docs as part of the template) and the parts that are specific to your transaction.

listing-contract-header.jpgThere are different situations where this applies to you. If you’re a seller, getting ready to hire a Realtor to represent you as a seller’s agent, to market your home and manage the real estate transaction, your Realtor will give you a contract which specifies some specific terms of the contractual agreement. This is commonly called a “Listing Contract” in the lingo of Realtors in Colorado. Officially, it’s the “Exclusive Right-to-Sell Listing Contract” but since that’s such a mouth-full, “listing contract” or “listing agreement” is typically what you’ll hear it called.

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