Words mean things. Especially so with regard to your real estate investment business. If you’ve never been exposed to a real estate purchase transaction recently you may have forgotten there is no shortage of paperwork involved. From the real estate documents provide protection - read the fine printbeginning to the very end, you’ll review hundreds of documents. At least you’d better.

Real estate sales contracts are one of the first important documents you’ll prepare when you decide to buy. Real estate contracts are a legal agreement between a buyer and a seller and there are specific performance matters that must be adhered to or the contract can be nullified. For instance, the buyer may have five days in which to inspect the property, after which amended offers may be ignored. Most sales contracts also require the buyer to arrange financing and have a loan approval before a certain date, if not, the contract might be cancelled and the buyer loses the earnest money due to non-performance.

Not paying attention to the wording in a contract can spell trouble. Don’t take anything for granted and if something doesn’t sit right with you, don’t accept the agreement. Regardless of the content is considered “boilerplate” or not.

When an escrow is opened and a settlement scheduled, a preliminary title report is provided. This document lists all liens on the property both current and past. Take some time to read through the title report and pay specific attention to any recorded liens that have yet to be released. Many times a lien is due for a release but never recorded. Outstanding liens need to be satisfied before any closing can take place.

The property appraisal is due for a review as well, especially if the sales price and the appraised value are upside down. When an appraisal amount is less than the sales price, the buyer must bring in the difference or cancel the transaction. In this instance, employ your real estate agent to review the appraisal and make sure the appraiser didn’t miss any recent sales that can justify a higher value.

When reviewing paperwork for your transaction, don’t take anything for granted. Documents are provided both for your information as well your protection and if something doesn’t read quite right or you’re a bit confused, get it cleared up. Once the property closes, it’s a done deal.