Paperwork

A new construction purchase and sale agreement or sales contract is similar to a resale contract but applies to a newly built home. Most builders have their specific forms They contain information such as the project's estimated closing date, the terms of the contract, who will be responsible for which expenses, and other obligations for the builder and buyer.

What to Look for in a Purchase and Sale Agreement

New construction purchase and sale agreements protect the builder by making sure that individual will be paid for his or her work, while also protecting the buyer against the home being sold to someone else. In addition, there are several things in the contract you should look for:

The date by which you need to finalize your design requests.

The date by which you need to have financing approved

The price you will pay.

The location where the property will be built.

The deposit amount, also known as earnest money.

Under a new build contract, you might have 30 to 45 days to back out of the agreement as a buyer if you have problems securing a loan. However, the builder will often attach penalties to this, such as withholding a portion of your deposit. If your loan falls through later in the building process, the builder will generally keep your earnest money.