What Is a Purchase and Sale Agreement in New York? A Seller’s Complete Guide

The purchase and sale agreement – called a "contract of sale" in New York – is the legal document that binds both parties to the transaction. Once signed by both buyer and seller, this contract governs everything that happens between that moment and the closing table.

Understanding what the contract contains, what its key provisions mean, and where sellers should pay closest attention protects you from committing to terms you didn't fully understand.

Who Drafts the Contract in New York

In New York, the seller's attorney drafts the contract of sale. This is one of the important distinctions of the New York real estate process – unlike many states where standard pre-printed forms are used, New York residential contracts are drafted by attorneys, typically beginning from a standard form (like the one used by the New York State Bar Association) with modifications specific to the transaction.

The buyer's attorney reviews the draft, requests modifications, and negotiates the final terms directly with your attorney. This attorney-to-attorney process is one of the reasons New York requires licensed attorneys for residential transactions.

The Key Provisions You Need to Understand

Purchase price and deposit. The contract specifies the agreed purchase price and the amount of the deposit – typically 10% of the purchase price – which the buyer delivers with the signed contract. It also specifies where the deposit is held (your attorney's escrow account) and under what circumstances it's returned to the buyer or forfeited to you.

Closing date. The contract specifies the anticipated or required closing date. This may be a specific date or a range ("on or about" a specific date, or "within 60 days of contract signing"). Understand whether the closing date is a hard deadline or an approximation, and what happens if one party can't close by that date.

What's included in the sale. The contract specifies what personal property and fixtures remain with the home – typically all built-in appliances, fixtures permanently attached to the structure, and any items specifically agreed to remain. It also specifies what the seller is taking – items excluded from the sale. Review this list carefully to ensure it matches your understanding of what stays and what goes.

Contingencies. As covered in earlier posts, contingencies give the buyer the right to exit or renegotiate under specific circumstances. The contract should specify the inspection contingency period and the buyer's rights under it; the mortgage contingency period and the loan amount and type the contingency covers; and the appraisal contingency terms if applicable.

Property condition representations. The contract will include representations from the seller about the property's condition – typically referencing the Property Condition Disclosure Statement and confirming that no material changes have occurred between the disclosure date and closing.

"As Is" language. New York contracts often include language conveying the property in its current condition, meaning the seller is not warranting the property's fitness for any particular purpose beyond what's specifically represented. Understanding the scope of "as is" language in your contract requires attorney explanation.

Title delivery provisions. The contract specifies what type of title you must deliver – marketable title free of liens and encumbrances, with specified exceptions. Your attorney ensures that you can actually deliver the title required by the contract.

Closing cost allocations. The contract specifies which costs are allocated to buyer versus seller – transfer taxes, attorney fees, title insurance, recording fees – confirming the economic terms of the transaction.

What Sellers Should Pay Attention To

The provisions most commonly requiring seller attention:

The included/excluded items list – confirm it accurately reflects what you intend to leave and take.

The contingency periods and buyer rights – understand precisely when contingencies expire and what the buyer can request during each period.

The closing date and the "time is of the essence" provisions – some contracts include language making the closing date a hard deadline with specific consequences for missing it.

Any seller representations that go beyond the standard – unusual representations requested by the buyer's attorney should be discussed carefully with your attorney before agreeing.

The earnest money forfeiture provisions – when exactly is the deposit forfeited to you, and under what circumstances is the buyer entitled to a return? These provisions define your protection if the buyer backs out.

Your attorney is your primary guide through the contract, but having a clear understanding of what you're signing – in plain language – is part of how I prepare every seller I work with. Call me at (321) 447-4259 or visit movewithricky.com.

Rakesh (Ricky) Khanna | Licensed Real Estate Salesperson
Better Homes and Gardens Real Estate Realty Connect
Call or text: (321) 447-4259 | movewithricky.com