SPA or Sales and Purchase Agreement is a legal contract that dictates the terms and conditions that a seller and buyer of a given property agree upon on the sale and purchase of a property. Basically, it is the document that binds the two parties under legal terms as dictated by the property laws of the country. As a legal document, a Sales and Purchase Agreement (SPA) has to be signed in the presence of a lawyer. This is done to ensure that both the seller and the buyer get to have a deep understanding of the core clauses outlined in the document for the property transaction.
What is Sales and Purchase Agreement (SPA)
This contract often acts as the basic legal framework that informs the parties involved in their legal rights and obligations. From it, the buyers can have detailed information about the property being purchased like the amount of deposit require, property price, property type, warranty period and the purchase price. The seller, on the other hand, will be informed about a number of things, such as the consequences that may arise in the event that there is a breach of contract.
The document acts as a protection for both the seller and the buyer. But in most cases, a good number of the protection privileges cover the buyer. This is to prevent cases of the seller altering with the outlined terms and conditions with the aim of exploiting the buyer during a property purchase.
In summary, a Sales and Purchase Agreement (SPA) is a binding contract in legal jargons that can always be used as evidence by either the seller or the buyer in the event that there is a misunderstanding after sealing a property deal.
If you are a buyer and you intend on buying a property but you lack detailed knowledge of property sales and acquisition, the first thing that you should consider doing is to hire a property lawyer. Property lawyers are well informed regarding the common process dos and don’ts when it comes to selling and buying of property.
A property lawyer will also give a breakdown of the clause on conditions precedent that are included in the SPA. This will provide clarifications on some of the subjects that may be complex such as condition precedent, termination clauses and delivery of possession. The buyer will also be able his/her rights and the possible legal actions that can be taken should the seller break the agreement. As a result, both the buyer and the seller will have an easy time in drafting the final contract.