“Just Sign Here!” Is it “Paperwork?” Or, “a Legal Contract?”

Putting Clients at Ease (Just Not Too Much)

My guess is, if you’ve worked with a Realtor (or any salesperson) lately, what you were ultimately asked to sign wasn’t referred to as a “legal contract.”

It was called “paperwork” (sample agent-to-client dialogue: “if you’re comfortable with everything we discussed, let’s get the paperwork taken care of, OK?”).

Wanna guess why the euphemism?

“Contract” sounds intimidating to many people; “paperwork” doesn’t.

Explain Things Now . . . or Explain Things Later

In fact, at least in residential real estate as practiced in Minnesota, there are six specific kinds of documents that Buyers and Sellers are asked to sign by their agent:  1) state-mandated acknowledgements (example:  “Agency Relationships”); 2) Seller property disclosures (acknowledged by Buyer); 3) the contract to hire a Buyer’s agent or Listing Agent (representing the Seller); 4) Broker disclosures (example:  related parties); 5) the Purchase Agreement and Addenda; and 6) and the closing or settlement statement.

Buyers who are getting a mortgage will have to sign a raft of additional doc’s required by their lender.

Regardless of terminology, what’s important is that the client understand what they’re signing.

Which means that it’s incumbent upon the salesperson to define key terms and explain their significance.

P.S.: In my experience, agents who skip the relatively small investment of time explaining contracts paperwork upfront front risk having to spent much more time later on trying to untangle things . . . .

See also, “Football, Baseball, and Real Estate Metaphors.”



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