How to Write a Contract Agreement For Selling Land

Vacant lot for sale
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A contract for the sale of land is different from a contract for the sale of personal property because when real estate is purchased, title must be transferred before the buyer will enjoy full rights to the property. In most cases, the buyer will not be able to fulfill the terms of the contract without the help of a third-party financing arrangement. For these and other reasons, it is important to take great care when drafting a contract for the sale of land.

Identify the parties to the contract by full legal names. Ask for photo IDs to confirm identities. If a representative will sign on behalf of a business entity, name the business entity in this section rather than the representative.

Describe the property being sold. A street address is usually not a sufficient legal description of a parcel of land. Plat numbers are usually used; however, some contracts use metes and bounds. Refer to the description used in the county property recorder's office.

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Set forth the amount of earnest money that the buyer must pay to guarantee that he will proceed with the closing. The buyer should pay the earnest money in cash or certified funds to an escrow agent before or at the time he signs the contract. The contract should state that the earnest money has been paid, name the escrow agent, and state that the earnest money will be either returned to the buyer or applied to the purchase price if the buyer proceeds with the closing.

List the seller's warranties. Typical warranties include undertakings that the seller will transfer the title document to the buyer's name at closing, that the seller will pay for all property-related expenses (such as utility bills, taxes and insurance) up to the closing date, and that the seller will cooperate with an inspection of the property (at the buyer's expense) prior to the closing date.

State the purchase price, and briefly describe the financing arrangements. The transfer of title should be made conditional on the buyer obtaining financing.

Set the closing date (the date on which the purchase price is paid and title is transferred into the buyer's name). The phrase "time is of the essence in this contract" means that either party may refuse to proceed with the closing if the other party delays closing by even one day past the scheduled closing date.

Insert standard contractual housekeeping provisions such as non-assignability of the contract (which would prevent either party from assigning their rights and obligations under the contract to a third party) and dispute resolution methods such as litigation or arbitration.

Verify that the signature lines are consistent with the identification of the parties in the first section of the contract, and that the appropriate legal representatives' names are listed (if either buyer or seller is a business association). In some cases such as partnerships and trusts, more than one individual may be required to sign on behalf of a single business entity.


  • Although many types of oral contracts are valid as long as the basic terms can be reliably established, a contract for the sale of land is required to be in writing in every state.


  • If the seller is financing the purchase, more specific provisions on payment amounts and timing will be required. The seller should not transfer title until the buyer has completed all payments.

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