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The Importance of Having a Thorough Land Contract

by | Mar 21, 2022 | Real Estate

Given the wealth of information available for free on the internet, many individuals and businesses have turned to sites like Legal zoom for contract templates in an attempt to avoid the cost of hiring an attorney to draft legal documents. Unfortunately, there are no shortcuts to ensuring your rights are protected. Every state has different laws and allowable provisions for different types of contracts. For the most part, these free and low-cost services do not provide all of the provisions necessary to protect your interests. This article outlines several important things to consider when deciding how to go about drafting and executing contracts that you won’t find in most pre-written online contracts.

Responsibilities

One of the most important aspects of any contract is to clearly and plainly state who is responsible for what. While this seems simple enough, there is an unimaginable amount of responsibilities that may never occur to you, until they come up. It is vitally important that your land contract outline which party is responsible for property taxes, maintenance of the property, ensuring compliance with local ordinances, as well as countless other responsibilities that may be unique to your particular situation.

Default Provisions

Another aspect of vital importance that is often underdeveloped in pre-written contracts is what happens when a party breaches the agreement? If you sell a property under land contract and the buyer stops making payments, what can you do to enforce the contract? Surprisingly, failing to outline the specifics of questions like these leave a buyer with very little recourse, and as a consequence seller’s can often breach the contract as often as they like, as long as they “cure” before a judgment is entered against them.

Attorney Fees

This is probably the most overlooked provision in pre-written contracts. When properly drafted, a contract can protect you from expensive litigation with a clause outlining who pays for attorney fees in the event a dispute arises. Beyond being able to recover legal expenses you incur enforcing the terms of a contract, the biggest benefit of having an attorney fee provision is that it provides a strong incentive for the other party to settle the dispute before you ever have to file a lawsuit.

This article is far from comprehensive when it comes to outlining all of the necessary provisions and considerations that most people overlook when utilizing pre-written contracts. Drafting effective contracts can be a daunting task. Unfortunately, taking short cuts only makes life more difficult if a contract dispute arises. That is why the attorneys at Gudeman & Associates work hard to ensure your interests are well protected. Contact us today to schedule a free 30-minute consultation.