Understanding the CAR Contract

1. Contract: Names of the buyer & seller, and the address of the property to be purchased. If the offer includes parking or storage, it should be noted here. 

2. Fixtures & Personal Property: This defines what is included in the sale. Anything attached to the unit (which is considered a fixture) stays unless otherwise noted (kitchen appliances, washer/dryer, lighting, etc.). If you are asking for any additional furniture items not noted, those will be noted on line 29. 

3. Purchase Price: The price you will pay for the property.

4. Closing Cost Credit (Optional): Contains an optional closing cost credit, paid by the seller.

5. Home Warranty (Optional): If the home contains aging appliances & mechanicals, you may ask for a home warranty up front. This costs ~$500+ & lasts for 1-2 years.

6. Earnest Money: This section outlines the earnest money that will be paid by you. This is typically paid in 2 installments.

7. Mortgage Contingency: This section outlines the date you must secure your loan.

8. Closing: The date you will close on the property.

9. Possession: This section states you will get keys & full possession of the property on closing day, unless a leaseback is noted in a Post-Closing Possession Rider.

10. The Deed: The seller must provide the deed at closing, which transfers title to the home to you.

11. Real Estate Taxes: This section outlines the most recent year’s real estate taxes, and any exemptions that the seller received. It also specifies how the taxes will be prorated. Often, this is marked as TBD and determined during attorney review.

12. Homeowners Association: This section outlines the assessments for the building, and requires the association to provide a Paid Assessment Letter before closing. It also outlines the Condo Document Contingency.

13. Disclosures: You will initial these boxes if they have received the property disclosures.

14. Confirmation of Dual Agency: This section will be completed if M&Co. is representing the buyer & the seller.

15. Attorney Modification: This section outlines the number of days that the buyer & seller’s attorneys have to propose modifications to the contract & open up negotiations. This can be extended if more time is needed.

16. Inspection: This section outlines the number of days that you have to conduct an inspection & defines the repair requests that can/should be made.

17. General Provisions, Riders and Addendums: This contract is only valid once signed by both the buyer & seller. If the buyer & seller have any separate agreements regarding the purchase, they will list them here.

Page 3 of the contract contains contact info for all parties. Page 4 contains general provisions for the contract.

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