Guide to Multi-Board Contract
The Multi-Board Residential Real Estate Contract 7.0 is the most common contract. Below, we’ve outlined each of the numbered sections in the contract.
1. The Parties: Names of the buyer & seller.
2. The Real Estate: The address of the property to be purchased. If the offer includes parking or storage, it should be noted here.
3. 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.
4. Purchase Price & Payment: The price you will pay for the property.
5. Closing: The date you will close on the property.
6. Possession: This section states you will get keys & full possession of the property on closing day, unless a leaseback is noted in Section 35.
7. Financing: This section notes if you will finance your purchase or pay in cash.
8. Statutory Disclosures: You will initial these boxes if they have received the property disclosures.
9. Prorations: This section specifies how the taxes & assessments will be prorated. Often, this is marked as TBD and determined during attorney review.
10. Attorney Review: This section says that the buyer & seller have 5 business days to have an attorney propose modifications to the contract & open up negotiations. This can be extended if more time is needed.
11. Waiver of Professional Inspections: This is checked if you are waiving the inspection. More commonly, we see buyers purchasing a contract “as-is” (specified in Section 36).
12. Professional Inspections & Inspection Notices: This section allows you to conduct an inspection & defines the repair requests that can/should be made.
13. Homeowner Insurance: If you are unable to obtain homeowner’s insurance for the property, you can cancel the contract.
14. Flood Insurance: You can cancel the purchase if the property is located in a special flood hazard area. This is not relevant for most of the city & suburbs.
15. Condo/Common Interest Associations: The content in this section will override any prior communications about association matters.
16. The Deed: The seller must provide the deed at closing, which transfers title to the property to you.
17. Municipal Ordinance Transfer Tax & Governmental Compliance: This notes that the property may be subject to “transfer taxes” which are a part of total closing costs.
18. Title: The seller must provide the title commitment, which shows all liens & encumbrances, which must be cleared by or at closing.
19. Plat of Survey: If the property is a single-family home, the seller must provide a plat of survey prior to closing.
20. Damage to Real Estate or Condemnation Prior to Closing: If the property is destroyed while it is under contract (due to fire or another emergency), you can terminate the contract or proceed with the contract and receive any insurance proceeds.
21. Condition of Real Estate & Inspection: The seller must leave the property “broom clean,” meaning all garbage & possessions should be removed. At the final walkthrough, you will confirm everything is functioning as it was during inspection.
22. Seller Representations: The seller represents that they don’t know anything about the property that would impact title or tax obligations.
23. Real Estate Tax Escrow: This explains how taxes will be prorated if any improvements are made. This paragraph rarely comes into effect, as escrows are typical for new construction homes, but not standard resale.
24. Business Days/Hours: This defines what a “business day” is.
25. Electronic or Digital Signatures: This allows us to use Docusign.
26. Direction to Escrowee: This outlines how earnest money will be returned if needed.
27. Notice: This defines what serves as “notice.”
28. Performance: Time is of the essence!
Optional Paragraphs
These paragraphs are only part of the contract if they are initialed by both parties.
29. Confirmation of Dual Agency: This section will be completed if M&Co. is representing the buyer & the seller.
30. Sale of Buyer’s Real Estate: This section is used if your purchase of the property is contingent on the sale of another property. You can learn more about home sale contingencies here.
31. Cancellation of Prior Real Estate Contract: This section is used if you are submitting your offer as a back-up offer. If the seller’s original contract falls through, the back-up offer becomes valid.
32. Home Warranty: If the home contains aging appliances & mechanicals, you can ask for a home warranty up front. This costs ~$500+ & lasts for 1-2 years.
33. Well or Sanitary Systems: If the property has a well or sanitary system, you can request the seller to pay for testing.
34. Wood Destroying Infestation: You can request the seller to pay for a termite inspection. This is not relevant for most of the city & suburbs.
35. Possession After Closing: You can opt to let the seller maintain possession of the property after closing, if they need extra time to move out or find their next home. This section defines the date you will take possession, as well as the fee for renting the property. You can learn more about leasebacks here.
36. “As Is” Condition: You can offer to purchase the property “as-is,” meaning you will still conduct the inspection, but you will not ask for any credits or fixes.
37. Specify Party Approval: This section allows for an additional 3rd party to approve the contract.
38. Attachments: If your agent attaches any extra riders to the contract (such as an appraisal gap rider or an escalation clause), it would be noted here.
39. Miscellaneous Provisions: If you & the seller have any separate agreements regarding the purchase, they will check these boxes.
Page 13 of the contract contains contact info for all parties.
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