Real Estate Purchase Contract For Residential Construction (Page 2 of 7) in pdf

2. PURCHASE PRICE The Purchase Price for the Residence is $

2.1 Method of Payment. The Purchase Price will be paid as follows:

(a) Earnest Money Deposit. Under certain conditions described in this Contract, THIS DEPOSIT

MAY BECOME TOTALLY NON-REFUNDABLE.

(b) Permanent Loan. Buyer agrees to apply for a "Permanent Loan" as provided in Section 2.3 below.

Buyer will apply for one or more of the following loans: [ ] FHA [ ] VA [ ] CONVENTIONAL [ ]

OTHER (specify)

Buyer agrees to accept the Permanent Loan at the interest rate offered by Buyer's lender as of the date of

Settlement. Buyer acknowledges that the loan interest rate at Settlement may exceed the rate quoted by

the lender as of Loan Application.

(d) Balance of Purchase Price in Cash at Settlement.

PURCHASE PRICE. Total of lines (a) through (d)

The Purchase Price may be increased if additional costs are incurred for extras as provided in Section 12. Buyer agrees to pay

for the cost of all such extras as provided in Section 12.

2.2 Financing Condition. (check applicable box)

(a) [ ] a "Construction Loan" shall be obtained by [ ] Seller [ ] Buyer in the amount of $

. Upon funding

of the Construction Loan, progress payments shall be made in accordance with the requirements of the construction lender.

(b) [ ] the Permanent Loan shall be obtained by Buyer. Buyer's obligation to purchase the Property IS CONDITIONED upon

Buyer qualifying for the Permanent Loan and, if applicable, the Construction Loan. Those loans are collectively referred to as

the "Applicable Loans." This condition is referred to as the "Financing Condition."

Section 2.3 does not apply.

2.3 Application for Loan.

(a) Loan Application. No later than the Application Deadline referenced in Section 24(a), Buyer shall apply for the Applicable

Loans at

. Loan Application occurs only when Buyer

has: (i) completed, signed, and delivered to the lender (the Lender) the initial loan application and documentation required

by the Lender; and (ii) paid all loan application fees as required by the Lender. Buyer agrees to diligently work to obtain the

Applicable Loans. Buyer will promptly provide the Lender with any additional documentation as required by the Lender.

(b) Pre-Qualification Letter. No later than the Pre-Qualification Deadline referenced in Section 24(b), Buyer agrees to

provide to Seller a "Pre-Qualification Letter" from the Lender for the Applicable Loans. Buyer agrees to diligently work to

obtain the Pre-Qualification Letter. The Pre-Qualification Letter shall state that: (i) the Buyer's credit report and income to debt

ratios are satisfactory to the Lender; and (ii) subject only to verification of the information contained in the Loan Application,

the Lender will grant the Applicable Loans.

(c) Right to Cancel. If the Lender fails to provide Buyer with a Pre-Qualification Letter, or if the Pre-Qualification Letter

contains conditions other than those specified in Section 2.3(b), Buyer or Seller may cancel this Contract by providing written

notice to the other party no later than three calendar days after the Pre-Qualification Deadline; whereupon the Earnest Money

Deposit shall be released to Buyer. If this Contract is not canceled as provided in this Section 2.3(c), Buyer and Seller shall

be deemed to have waived any objections regarding the lack of, or any conditions contained in the Pre-Qualification Letter.

(d) Funding of Construction Loan. If Buyer is obtaining a Construction Loan and the proceeds of that loan are not available

for disbursement by the Construction Loan Funding Deadline referenced in Section 24(c), Buyer or Seller may cancel this

Contract by providing written notice to the other party no later than three calendar days after the Construction Loan Funding

Deadline; whereupon the Earnest Money Deposit shall be released to Buyer.

2.4 Non-Refundable Deposit.

(a) Pre-Qualification. If this Contract is not canceled as provided in Sections 1.5, 2.3(c) or (d), or Section 8, then

% of

the Earnest Money Deposit shall be totally non-refundable to Buyer unless Seller fails to complete the Residence as provided

under Sections 11 and 12.

(b) Subsequent Disqualification. If prior to Settlement, Buyer receives written notice from the Lender that the Lender does

not approve the Permanent Loan (a "Loan Denial"), Buyer shall, no later than three calendar days thereafter, provide a copy

to Seller. Buyer or Seller may, within three calendar days after Seller's receipt of such notice, cancel this Contract by providing

written notice to the other party; whereupon the non-refundable portion of the Earnest Money Deposit shall be released to

Seller and the refundable portion to Buyer.

3. SETTLEMENT AND CLOSING. Seller shall provide Buyer written notice of Substantial Completion of the Residence.

Settlement shall take place on the Settlement Deadline referenced in Section 24(g), or on a date upon which Buyer and Seller

agree in writing. "Settlement" shall occur only when all of the following have been completed: (a) Buyer and Seller have signed

and delivered to each other (or to the escrow/closing office), all documents required by this Contract, by the Lender, by written

escrow instructions and by applicable law; (b) any monies required to be paid by Buyer under these documents (except for the

proceeds of any new loan) have been delivered by Buyer to Seller or to the escrow/closing office, as appropriate, in the form

Page 2 of 7

Buyer's Initials___________ Date___________ Seller's Initials___________ Date___________

Real Estate Purchase Contract For Residential Construction Page 2

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