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Contract Mistakes

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1. Using Generic, One-Size-Fits-All Contracts.

To maximize your profits and avoid costly mistakes, you have to choose your contracts as carefully as you choose your investment property. Generic real estate contracts available at local and other online retailers are not written to protect any particular interest, they aren't drafted by specialists in the real estate field, and they don't include important provisions needed to prevent common and costly problems. Litigation is expensive and uncertain, so you should use contracts that give you the maximum protection and leverage available even before you get to court. Contract Authority’s contracts are tailored to protect your interests, whatever side of the transaction you are on. We offer buyer-side and seller-side documents, carefully crafted by experienced real estate investors and attorneys to protect your interests in the deal.

2. Not Understanding How to Read and Enforce Your Contract.

Your contract is what defines your rights and your obligations. It’s the “playbook” for your investment and you should know it like the back of your hand. Real estate investors who do not take the time to get the education they need about what their contract says, why it says what it says, and how each of its provisions apply in day-to-day situations, can lose deals, clients and profits. Contract education is the number one “missing link” that we see in real estate investors’ tools for success. A contract is only as good as the know-how of the person who is trying to use it. One of the many things that sets Contract Authority apart is that we don’t just provide you with great contracts, we offer the education and know-how to help you utilize them.

3. Not Including Provisions to Protect You Against Foreseeable Contingencies.

Sometimes real estate investors gravitate toward short, simple sounding documents because they feel that they are easier to understand and easier to get someone to sign. This is a dangerous approach to your investment. The reason that tough and solid contracts can be lengthy is that they anticipate problems that might arise and address them, up front. Our contracts are not designed just to win if you end up in court, but to keep you out of court by carefully defining everyone’s rights and obligations and avoid misunderstandings. Our contracts are the result of years of collaboration between lawyers and real estate investors, incorporating real life investment experiences, and including provisions to protect you and your property.

4. Choosing Contracts Based on Price, Rather than Value.

There are many free and low-cost real estate contracts available online, which may seem like an attractive alternative to paying high legal fees to get your contracts. But there is truth to the adage, “you get what you pay for.” Good contracts pay for themselves many times over. We cannot stress enough how vital the contract is to your investment. Whether any particular real estate investment is a winner or a loser may ultimately have less to do with the actual property than how you protect it through your contracts. Contract Authority provides you with solid, customizable contracts, but at a fraction of the price you would pay an attorney.

5. Ignoring the Rules of Contract Construction Used by Courts.

Contract language needs to be chosen carefully to avoid ambiguities. Language is not an exact science, and two people may look at certain language and attach very different meanings to it. Contract disputes often center on the meaning of just a few words or phrases in the contract. Courts have developed certain "rules of contract construction" and presumptions under the law to resolve arguments over a contract. Contract Authority’s documents have been drafted with these rules of contract construction in mind, with attention paid to every single word in each of the documents.

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