NYC Real Estate Purchase Contracts can be far more complex than the standardized purchase forms used in other states. Furthermore, real estate purchase contracts in NYC can be quite customized for each transaction with many parts being negotiable.
What is a real estate purchase contract?
A real estate purchase contract is a legally binding agreement between the buyer and the seller of a property. In NYC, the real estate purchase contract is negotiated by the buyer’s attorney with the seller’s attorney. This purchase and sale agreement states the terms and conditions of the deal, remedies for default and any contingencies (i.e. mortgage contingency or sale contingency).
If you are selling your home For Sale By Owner in New York City, it’s highly recommended that you work with a seasoned real estate attorney who can guide you through the closing process, perform legal and financial due diligence and negotiate the real estate purchase contract on your behalf. We’ve included a hypothetical real estate purchase contract below so you can get a sense of what it looks like, but please consult your attorney as contracts are customized for each transaction!
Sample NYC Real Estate Purchase Contract Template
We’ve included a lengthy, typical NYC real estate purchase contract geared towards new development for your review below. Please note that individual real estate purchase contracts in NYC can vary greatly and are customized per transaction by your attorney. This sample is just to give you a flavor of the complexity and length of real estate purchase contracts in NYC vs the simple, standardized forms used in transactions in other states.
It’s interesting to notice that purchase contracts for new development transactions essentially give the developers as much time as they need to finish construction. However, reputable sponsors who take pride in and stand by their work will typically agree to a “kick-out date.” Your lawyer can negotiate a kick-out date on your behalf which basically lets you out of the contract after a certain time period if a closing does not take place. For example, your lawyer might negotiate to let you walk away from the contract with your deposit if construction doesn’t finish and a closing doesn’t happen within one year.
Side story: a buyer looking at new construction in Brooklyn happened to be a private investigator who was always meticulous in his research. Much to the dismay of the developer of this low-rise project that the buyer was already in contract to purchase, the buyer ordered a total of three different home inspections! One of the inspections involved the use of infrared cameras to look inside the walls. It turned out from this thorough due diligence that the building was built very poorly even though it had passed government inspections. Even though the sponsor legally only had to build it to code and the buyer was theoretically tied to the deal, the buyer was still able to get out by threatening to sue. It made sense for the sponsor to release the buyer’s deposit because any lawsuit exposing the alleged faults in the building would come up immediately in a Google search and surely tank the potential sale prices of the unsold units!
THIS AGREEMENT is made as of [Date] between [Sponsor] (hereinafter called the “Sponsor”), having an address at [Sponsor Address], and [Buyer] (hereinafter called the “Purchaser”), having an address at [Buyer Address], and [Law Office] (hereinafter called the “Escrow Agent”), having an address at [Lawyer Address].
The following terms shall have the meanings ascribed to them:
(i) “Agreement”: This Purchase Agreement. “Amendment”: An amendment to the offering Plan accepted for filing by the Attorney General, or if applicable an amendment to the recorded condominium Declaration.
(ii) “Attorney General”: The Attorney General of the State of New York.
(iii) “Balance”: the amount set forth in paragraph 4.
(iv) “Building”: shall mean the structure known as [Address].
(v) “Business day”: Any day that is not a Saturday or Sunday or legal holiday of the State of New York or U.S. Government.
(vi) “Claim”: any kind of claim, right or cause for Lawsuit or Lawsuit.
(vii) “Closing Date”, “closing”, “closing of title”: and words of similar import are used synonymously and mean the settlement of the mutual obligations of the Sponsor and Purchaser under this Purchase Agreement, including the payment to Sponsor of the Purchase Price and the delivery to Purchaser of the deed transferring full ownership (fee simple title) to the Unit on the terms set forth in this Agreement.
(viii) “Commitment”: A written offer to make a loan to Purchaser, with or without recourse, whether or not conditional upon any factor, secured by a first mortgage on the Unit.
(ix) “Condominium”: shall mean The [Address] Condominium.
(x) “Declaration”: shall mean the Declaration of The [Address] Condominium establishing ownership of the Property.
(xi) “Deed”: The deed described in paragraph 8 conveying the Unit to the Purchaser.
(xii) “Department of Law”: The Department of Law of the State of New York, which is administered by the Attorney General.
(xiii) “Include”, “includes”, “including”, “such as”, “for example” and similar words: Whenever these words precede a list of one or more items, the list is not to be limited to the item(s) mentioned and shall always be construed as though followed by the words “but not limited to”.
(xiv) “Indemnify”: or a derivation thereof: this includes to defend and hold harmless.
(xv) “Institutional Lender”: A bank, saving bank, savings and loan association, trust company, credit union of which Purchaser is a member, licensed mortgage banker, insurance or governmental entity duly authorized to make a loan secured by a first mortgage on the unit.
(xvi) “Plan”: shall mean the Offering Plan to convert the Property to condominium ownership and any Amendments thereto filed prior to the date upon which Purchaser signs this Agreement.
(xvii) “Property”: shall mean the Building and the land on which it is erected, which are to be submitted to condominium ownership pursuant to Article 9-b of the Real Property Law.
(xviii) “Purchase Price”: The Purchase Price of the Unit set forth in paragraph 4.
(xix) “Notice”: to Purchaser shall include facsimile transmission to Purchaser or Purchaser’s attorney. Seller’s attorney may send all notices to Purchaser’s attorney and/or Purchaser via facsimile. A facsimile confirmation printout by Seller’s attorney showing transmission was complete is sufficient evidence that the facsimile has been transmitted and the notice has been served. All other terms not defined elsewhere herein shall have the meanings ascribed to them in the Plan.
Purchaser acknowledges having received and read the Plan at least three (3) full business days prior to Purchaser’s signing this Purchase Agreement. Purchaser hereby adopts, accepts and approves the Plan (including, without limitation, the proposed Condominium Documents contained in Part II of the Plan) and agrees to abide and be bound by the terms and conditions thereof, as well as all Amendments to the Plan duly filed by Sponsor (including, without limitation, amendments involving any changes, modifications, or updating of the estimated Common Charges, the estimated real estate taxes to be paid by Purchaser, or the “Schedule B–Budget for First Year of Condominium Operation” of The [Address] Condominium. Any such amendments shall neither excuse Purchaser from performing Purchaser’s obligations hereunder nor entitle Purchaser to any offset or credit against the Purchase Price and may be made by Sponsor without Purchaser’s consent or approval. The Plan is hereby incorporated in this Agreement with the same force and effect as if set forth at length. In the event of any inconsistency or conflict between the provisions of this Agreement and those contained in the Plan, the provisions of the Plan shall govern and be binding. Purchaser acknowledges having had full opportunity to examine all documents, and investigate all statements, made herein and in the Plan.
3. Agreement to Purchase and Sell
Purchaser agrees to purchase from Sponsor, and Sponsor agrees to sell to Purchaser, for the Purchase Price Stated in paragraph 4, the unit designated as Unit Number 2 (hereinafter called the “Unit”) in the Declaration, together with its appurtenant interest (hereinafter called the “Common Interest”) in the Common Elements, on and subject to, the terms and conditions set forth herein.
4. Purchase Price
The purchase price for the Unit (exclusive of closing adjustments and costs referred to in Paragraphs 13 and 14 below) is $[Price] (hereinafter called the “Purchase Price”), which Purchaser agrees to pay to the Sponsor, as follows:
(i) $[Contract Deposit] (hereinafter called the “Down Payment”) is due on Purchaser’s signing and submitting of this Agreement and is to be paid by Purchaser’s personal check, receipt of which (subject to collection) is hereby acknowledged by Sponsor;
(ii) $[Remaining Amount] (hereinafter called the “Balance”), constituting the balance of the Purchase Price, is due on the delivery to Purchaser of the deed to the Unit and must be paid by Purchaser’s personal certified check or official cashier’s check, in either event drawn on a bank that is a member of the New York Clearing House Association.
The payment of the Balance and acceptance of deed to the Unit by Purchaser shall constitute Purchaser’s recognition that Sponsor has satisfactorily performed those obligations stated in the Plan and this Agreement to be performed by Sponsor prior to closing. However, nothing herein contained shall excuse Sponsor from performing those obligations (if any) expressly stated herein or in the Plan to be performed subsequent to the closing.
Purchaser is not required to pay the Balance or accept title to the Unit unless concurrently with, or prior to, closing all the prerequisites set forth under “Closing and Terms of Sale” in Part I of the Plan are met.
THIS PURCHASE AGREEMENT IS NOT CONDITIONED UPON A PURCHASER SECURING SATISFACTORY FINANCING. THE SPONSOR MAY, AT ITS OPTION, CONDITION THE CONTRACT UPON FINANCING, PROVIDED THAT PURCHASER AND SPONSOR BOTH PROPERLY COMPLETE AND INITIAL A FINANCING CONTINGENCY RIDER, THE FORM OF WHICH IS ANNEXED HERETO AS EXHIBIT “B”.
SPONSOR IS NOT OBLIGATED TO EXTEND OR ARRANGE FINANCING. NO REPRESENTATION IS MADE THAT BANK FINANCING WILL BE AVAILABLE TO PURCHASER OR AS TO THE AMOUNT, TERMS AND CONDITIONS UPON WHICH SUCH FINANCING MAY BE GRANTED OR THE COST TO OBTAIN SAME.
Procedure to Purchase
(i) [Law Office], with an address at [Contact Information], shall serve as escrow agent (“Escrow Agent”) for Sponsor and Purchaser. Escrow Agent has designated the following attorneys to serve as signatories: [Lawyer Name]. All designated signatories are admitted to practice law in the State of New York. Neither the Escrow Agent nor any authorized signatories on the account are the Sponsor, Selling Agent, Managing Agent, or any principal thereof, or have any beneficial interest in any of the foregoing.
(ii) Escrow Agent and all authorized signatories hereby submit to the jurisdiction of the State of New York and its Courts for any cause of action arising out of the Purchase Agreement or otherwise concerning the maintenance of release of the Deposit from escrow.
(iii)The Escrow Agent has established the escrow account at America Bank, N.A., located at [Bank Address] (“Bank”), a bank authorized to do business in the State of New York. The escrow account is entitled “[Law Office] Attorney Escrow Account” (“Escrow Account”). The Escrow Account is an IOLA account. The Escrow Account is federally insured by the FDIC at the maximum amount of $250,000 per deposit. Any deposit in excess of $250,000 will not be insured, unless Escrow Agent has established multiple accounts on behalf of Purchaser at various institutions.
(iv) All Deposits received by Purchaser shall be in the form of checks, money orders, wire transfers, or other valid instruments, and shall be made payable to or endorsed by the Purchaser to the order of “[Law Office] as Attorney”.
(v) The Escrow Account is an IOLA account with no interest accrued to the benefit of the either the Sponsor or the purchaser. An IOLA account is a special segregated escrow account maintained by an attorney in which the interest earned is paid to the State of New York. It is not anticipated that any interest will be earned thereon. If at some future point, the Offering Plan is amended to provide that the account will be a non-IOLA account, then the interest rate for all deposits made into the Escrow Account shall be the prevailing rate for such accounts. Interest shall begin to accrue upon placing the deposit into the Escrow Account. All interest earned thereon shall be paid to or credited to the Purchaser at closing. No fees of any kind may be deducted from the Escrow Account, and the Sponsor shall bear all costs associated with the maintenance of the Escrow Account.
(vi) Within five (5) business days after the Purchase Agreement has been tendered to Escrow Agent along with the Deposit, the Escrow Agent shall sign the Purchase Agreement and place the Deposit into the Escrow Account. Within ten (10) business days of the placing the deposit in the Escrow Account, Escrow Agent shall provide written notice to Purchaser and Sponsor, confirming the Deposit. The notice shall provide the account number and the initial interest rate to be earned on the Deposit. Any Deposits made for upgrades, extras, or custom work shall be initially deposited into the Escrow Account, and released in accordance to the terms of the Purchase Agreement.
(vii) The Escrow Agent is obligated to send notice to the Purchaser once the Deposit is placed in the Escrow Account. If the Purchaser does not receive notice of such deposit within fifteen (15) business days after tender of the Deposit, he or she may cancel the Purchase Agreement within ninety (90) days after tender of the Purchase Agreement and Deposit to Escrow Agent. Complaints concerning the failure to honor such cancellation requests may be referred to the New York State Department of Law, Real Estate Finance Bureau, 120 Broadway, 23rd Floor, New York, NY 10271. Rescission shall not be afforded where proof satisfactory to the Attorney General is submitted establishing that the Deposit was timely placed in the Escrow Account in accordance with the New York State Department of Law’s regulations concerning Deposits and requisite notice was timely mailed to the Purchaser.
(viii) All Deposits, except for advances made for upgrades, extras, or custom work received in connection with the Purchase Agreement, are and shall continue to be the Purchaser’s money, and may not be comingled with any other money or pledged or hypothecated by Sponsor, as per GBL § 352-h.
(ix) Under no circumstances shall Sponsor seek or accept release of the Deposit of a defaulting Purchaser until after consummation of the Plan, as evidenced by the acceptance of a post-closing amendment by the New York State Department of Law. Consummation of the Plan does not relieve the Sponsor of its obligations pursuant to GBL §§ 352-e(2-b) and 352-h.
(x) The Escrow Agent shall release the Deposit if so directed:
(a) pursuant to terms and conditions set forth in the Purchase Agreement in upon closing of title to the Unit; or
(b) in a subsequent writing signed by both Sponsor and Purchaser; or
(c) by a final, non-appealable order or judgment of a court.
If the Escrow Agent is not directed to release the Deposit pursuant to paragraphs (a) through (c) above, and the Escrow Agent receives a request by either party to release the Deposit, then the Escrow Agent must give both the Purchaser and Sponsor prior written notice of not fewer than thirty (30) days before releasing the Deposit. If the Escrow Agent has not received notice of objection to the release of the Deposit prior to the expiration of the thirty (30) day period, the Deposit shall be released and the Escrow Agent shall provide further written notice to both parties informing them of said release. If the Escrow Agent receives a written notice from either party objecting to the release of the Deposit within said thirty (30) day period, the Escrow Agent shall continue to hold the Deposit until otherwise directed pursuant to paragraphs (a) through (c) above. Notwithstanding the foregoing, the Escrow Agent shall have the right at any time to deposit the Deposit contained in the Escrow Account with the clerk of the county where the unit is located and shall give written notice to both parties of such deposit. The Sponsor shall not object to the release of the Deposit to:
(a) a Purchaser who timely rescinds in accordance with an offer of rescission contained in the Plan or an Amendment to the Plan; or
(b) all Purchasers after an Amendment abandoning the Plan is accepted for filing by the Department of Law.
The Department of Law may perform random reviews and audits of any records involving the Escrow Account to determine compliance with all applicable statutes and regulations.
(xi) Any provision of the Purchase Agreement or separate agreement, whether oral or in writing, by which a Purchaser purports to waive or indemnify any obligation of the Escrow Agent holding any Deposit in trust is absolutely void. The provisions of the Attorney General’s regulations and GBL §§ 352-e(2-b) and 352-h concerning escrow trust funds shall prevail over any conflicting or inconsistent provisions in the Purchase Agreement, Plan, or any amendment thereto.
(xii) Escrow Agent shall maintain the Escrow Account under its direct supervision and control.
(xiii) A fiduciary relationship shall exist between Escrow Agent and Purchaser, and Escrow Agent acknowledges its fiduciary and statutory obligations pursuant to GBL §§ 352-e(2-b) and 352(h).
(xiv) Escrow Agent may rely upon any paper or document which may be submitted to it in connection with its duties under this Purchase Agreement and which is believed by Escrow Agent to be genuine and to have been signed or presented by the proper party or parties and shall have no liability or responsibility with respect to the form, execution, or validity thereof.
(xv) Sponsor agrees that it shall not interfere with Escrow Agent’s performance of its fiduciary duties and statutory obligations as set forth in GBL §§ 352-e(2-b) and 352-(h) and the New York State Department of Law’s regulations.
(xvi) Sponsor shall obtain or cause the selling agent under the Plan to obtain a completed and signed Form W-9 or W-8, as applicable, from Purchaser and deliver such form to Escrow Agent together with the Deposit and this Purchase Agreement.
(xvii) Prior to release of the Deposit, Escrow Agent’s fees and disbursements shall neither be paid by Sponsor from the Deposit nor deducted from the Deposit by any financial institution under any circumstance.
(xviii) Sponsor agrees to defend, indemnify, and hold Escrow Agent harmless from and against all costs, claims, expenses and damages incurred in connection with or arising out of Escrow Agent’s responsibilities arising in connection with this Purchase Agreement or the performance or non-performance of Escrow Agent’s duties under this Purchase Agreement, except with respect to actions or omissions taken or suffered by Escrow Agent in bad faith or in willful disregard of the obligations set forth in this Purchase Agreement or involving gross negligence of Escrow Agent. This indemnity includes, without limitation, disbursements and attorneys’ fees either paid to retain attorneys or representing the hourly billing rates with respect to legal services rendered by Escrow Agent to itself.
Closing Contingent on Plan Being Declared Effective
The respective obligations of Purchaser and Sponsor hereunder are contingent upon the Plan being declared effective. The Plan shall not be declared effective except in accordance with the prerequisites set forth in the Plan, as same may be amended from time to time. Purchaser understands and agrees that the Sponsor shall have the right to abandon the Plan at any time prior to its being declared effective or thereafter, in certain limited cases set forth in the Plan (see the section in the Plan entitled “Effective Date” for full details). The Plan will be abandoned or deemed abandoned if it has not been declared effective within the time limits prescribed in the Plan. The Sponsor shall notify Purchaser, in writing or by a duly filed Amendment to the Plan, when the Plan becomes effective or is abandoned.
Closing Date and Place
The closing of title shall occur on the date and at the time and place in the State of New York as Sponsor shall designate to Purchaser on not less than thirty (30) days’ prior written notice. Sponsor shall have the right, from time to time, to adjourn such date and time for closing written notice to Purchaser. If adjourned, Sponsor shall fix a new date and time for title closing and shall give Purchaser not less than ten (10) business days’ prior written notice of the new scheduled date and time for closing. Purchaser may waive this thirty (30) day provision by initialing below.
I hereby waive the provision requiring thirty (30) days’ notice of closing __________
In the event that the closing of title does not occur on or before [Date], and such delay in closing is not the fault of Purchaser, then Purchaser shall have the right to cancel this Agreement and receive a return of the full down payment from Sponsor.
Additionally, notwithstanding any of the foregoing, Purchaser shall have a one-time right to a ten (10) day adjournment of the closing of title without any penalty or other additional fees, including, but not limited to, additional legal fees, provided that such adjournment is made at least seven (7) days prior to the initially scheduled closing of title.
At closing, Sponsor shall deliver to Purchaser a Bargain and Sale Deed with covenant against grantor’s acts transferring to Purchaser full ownership (fee simple title) to the Unit. The deed shall be substantially in the form reproduced as Document Number 5 in Part II of the Plan and shall be executed and acknowledged by Sponsor in form for recording. Such executed deed shall be delivered immediately to the representative of the title company insuring Purchaser’s title (or, if no such representative is present, to Purchaser or Purchaser’s attorney).
State of Title
Legal ownership to the Unit shall be transferred to Purchaser at closing subject only to the liens, encumbrances and title conditions (hereinafter called the “Permitted Encumbrances”) enumerated in Exhibit A to this Agreement.
Any encumbrance to which title is not to be subject shall not be an objection to title if (i) the instrument required to remove it of record is delivered at or prior to the closing of title to the proper party or to Purchaser’s title insurance company, together with the attendant recording or filing fee, if any, or (ii) Riverside Abstract, (or such other title insurance company as Purchaser may utilize), is or would be willing, in a fee policy issued by it to the Purchaser, to insure Purchaser that it will not be collected out of the Unit if it is a lien, or will not be enforced against the Unit if it is not a lien. The parties agree that the Sponsor may pay and discharge any liens and encumbrances upon the Property, not provided for in the Plan or this Purchase Agreement, out of the monies to be paid by the Purchaser at the time of closing title.
Notwithstanding anything else to the contrary in this Purchase Agreement or the Plan, if Sponsor is unable to deliver title to the Unit to Purchaser in accordance with the provisions of this Purchase Agreement and the Plan, Sponsor shall not be obligated to bring any action, suit or other proceeding or otherwise incur any cost or expense of any nature whatsoever in excess of its obligations set forth in the Plan in order to cure such inability, and, in such case, if Sponsor notifies Purchaser of its refusal to cure such inability and if Purchaser is not in default hereunder, Purchaser’s sole remedy shall be either (i) to take title to the Unit subject to such inability (without any abatement in, or credit against, the Purchase Price, or any claim or right of action against Sponsor for damages or otherwise) or (ii) to terminate this Purchase Agreement. If Purchaser so elects to terminate this Purchase Agreement, Sponsor shall, within thirty (30) days after receipt of notice of termination from Purchaser, return to Purchaser all sums deposited by Purchaser hereunder (except for funds released to Sponsor to be used for special work, upgrades or extras), together with interest earned thereon, if any, and, upon the making of such payment, this Purchase Agreement shall be terminated and neither party hereto shall have any further rights, obligations or liability to or against the other under this Purchase Agreement or the Plan except for provisions hereof that by their terms survive the termination hereof. The foregoing remedy must be exercised by notice of Purchaser in writing to Sponsor within fifteen (15) days after the giving of Sponsor’s notice of refusal to cure such inability, failing which it shall be conclusively deemed that Purchaser elected the remedy described in clause (i) above (i.e., to acquire title subject to such inability).
Title Company Approval
Sponsor shall give, and Purchaser shall accept such title as any member of the New York Board of Title Underwriters will approve and insure, provided only the liens, encumbrances and conditions affecting title shall be the Permitted Encumbrances. Sponsor shall not be obligated to satisfy any exceptions to title raised by any other title insurance company.
Sponsor’s Inability to Convey Title
Sponsor may not abandon the plan after effectiveness for any reason other than a defect in title which cannot be cured without litigation or cannot be cured for less than a stated amount which shall not be less than one-half of one percent of the total offering amount.
In the event that the Sponsor shall for any reason (except for willful default) be unable to convey and deliver the apartments in accordance with the terms of the Purchase Agreement, (except for any failure to perform any obligation imposed by applicable statute or regulation, or a failure to perform Sponsor’s obligations under the Offering Plan) the sole remedy of the purchaser shall be to rescind the Purchase Agreement and be refunded the entire down payment with interest plus the cost of title searches, if any.
Any conflict between the Plan and the Purchase Agreement shall be resolved according to the terms of the Plan.
Nothing contained in the Purchase Agreement or in the Plan shall be construed to waive a purchaser’s rights or abrogate Sponsor’s obligations under Article 23-A of the GBL.
At closing, Sponsor and Purchaser shall apportion, as of midnight of the day preceding the closing:
(i) real estate taxes (including all prepaid real estate taxes) and assessments, if any, on the basis of the fiscal or calendar year for which assessed, including water charges and sewer rents (if separately assessed) and any escrows for real estate taxes;
(ii) Common Charges for the month in which title closes; and
(iii) rent and other charges, if any, pursuant to a lease for, or tenancy of, the Unit.
(iv) insurance apportioned to unit until the policy expiration date
The “Customs in Respect of Title Closings” recommended by The Real Estate Board of New York, Inc., as amended to date, shall apply to the adjustments and other matters therein mentioned, except as otherwise provided herein.
In the event the Unit has not been separately assessed for the then current fiscal tax year at the time of title closing, the apportionment of real estate taxes shall be based on the Unit’s pro-rata share (in proportion to its Common Interest) of the then current real estate taxes assessed against the Property. If the Unit has been separately assessed but the closing occurs before the tax rate is fixed, then the apportionment of real estate taxes shall be based upon the latest tax rate applied to the most recent assessed valuation.
Any errors or omissions in computing apportionments at closing shall be corrected and payment made to the proper party promptly after discovery. This provision shall survive the closing.
Installments for tax assessments due after the delivery of the deed, if any, shall be paid by the Purchaser without abatement, set off or credit against the Purchase Price, without recourse of any kind against the Seller and shall not be considered a defect in title.
Purchaser’s Closing Costs
At the time of title closing, each Purchaser of a Unit will pay the balance of the Purchase price along with certain closing costs in addition to the legal fees of such Purchaser’s counsel and the amount of any net credit in favor of Sponsor resulting from the closing apportionments described above. Such closing costs will include the following, the amounts of which are based on rates in effect on the date of the Plan and are subject to change without prior notice or amendment:
(i) If such Purchaser elects to obtain fee title insurance, he or she will pay a premium therefor to his or her title insurance company which will vary depending upon the amount of insurance requested. The premium for fee title insurance, if ordered through a title insurance company (the Purchaser is free to choose any title company), should be $773.00 for the first $100,000.00 of fee insurance plus $4.36 for each $1,000.00 or fraction thereof of additional fee insurance up to $500,000.00. The premium for mortgage title insurance should be $654.00 for the first $100,000.00 of insurance plus $3.64 for each $1,000.00 or fraction thereof of additional insurance up to $500,000.00. Riverside Abstract: a) has updated the title search; and b) has been retained by the Sponsor to clear any title issues affecting the premises, and c) has been retained by the Sponsor to record any documents requiring recording with respect to this offering plan. A copy of the title report will be furnished to the purchaser. In the event that Purchaser’s title company refuses to accept Sponsor’s undertaking in lieu of an escrow, then the Purchaser shall be required to accept title insurance from the title company procured by Sponsor provided that such title company will accept such undertaking.
(ii) A fee for recording the deed and Unit Owner’s Power of Attorney of $32.00 for each instrument plus $5.00 per page, together with a service charge to the title company for such recording of approximately $185.00;
(iii) Purchaser shall pay all governmental fees and title company service charges associated with discharging and recording a mortgage lien release and UCC-3 termination statement or other appropriate instruments discharging the unit and its contents from any mortgage lien and security interest other than the lien of any mortgage loan Purchaser obtains.
(iv) If Purchaser obtains a mortgage loan, Purchaser will pay:
(a) a fee and service charge for recording the mortgage at the same rates given above for recording the deed;
(b) mortgage recording tax in the amount provided for by law, currently 2.05% (1.8% paid by the purchaser, 0.25% paid by the Lending Bank) of the face amount of the mortgage for mortgages under $500,000.00 and 2.175% (1.925% paid by the purchaser, 0.25% paid by the Lending Bank) for mortgages over $500,000.00);
(c) Purchasers shall pay Seller an equal to all of Purchaser’s savings in the mortgage recording tax to which Purchaser is entitled, whether such savings result from an assignment of an existing mortgage on the unit or is pursuant to Real Property Law 339-ee or otherwise. (Note: The Lending Bank pays an additional 0.25%);
(d) Purchasers will pay a premium through the title insurance company for the mortgage title insurance policy. In addition, such Purchaser shall pay Sponsor a sum equal to the partial mortgage tax credit to which Purchaser is entitled under Section 339-ee(2) of the Condominium Act. All such payments shall be made upon execution of the loan documents.
(e) all costs and expenses in connection with such loan in amounts determined by the lender, i.e., application, points, credit report, survey, appraisal, bank’s attorney’s fees, Residential and Condominium Endorsements (title insurance forms required by banks) escrows (such as for common charges and real estate taxes) private mortgage insurance if any, and any other fees required by lender. Sponsor makes no representation or warranty as to such closing costs or expenses or as to the availability of such financing.
(v) Although usually Seller’s expense, Purchaser SPONSOR shall pay the Real Property Transfer Tax due to The City of New York. This tax is in the amount of 1% of the total purchase price of the Unit if the purchase price is $500,000.00 or less and 1.425% of the total purchase price if the purchase price is more than $500,000.00. The Purchaser SPONSOR shall also pay for the New York State Real Estate Transfer Tax (currently $2.00 per $500.00, or fractional portion thereof of the purchase price) imposed by statute on transferors of property. For purposes of calculating the transfer taxes to be paid, consideration includes the transfer taxes paid by the Purchaser. The sample calculation of taxes in the Plan includes tax on the consideration.
(vi) Under Section 1402-a of the New York Tax Law, a “Mansion Tax” of one percent (1%) of consideration is payable by the grantee (Purchaser) on each conveyance of residential real property, including condominium units where the consideration for the entire conveyance is $1,000,000.00 or more. Residential real property includes a one to three family house, an individual condominium unit, and a cooperative unit that is or may be used, in whole or in part, as a personal residence.
(vii) Purchaser will be required to deposit with the Board of Managers two (2) months’ estimated monthly common charges for his unit to be used as working capital.
(viii) Purchaser shall be obligated to pay a fee to the law firm of Sponsor’s attorney of (i) $2,000.00 for services rendered in connection with the recording of the Declaration of Condominium and the preparation of documents plus an additional $350.00 for any work in connection with obtaining a mortgage; (ii) $250.00 if the closing is held at any location other than sponsor’s attorney’s office; (iii) $250.00 if e-forms for New York City Real Property Transfer Tax are prepared by Sponsor’s attorney; and (iv) $250.00 for each time the closing is rescheduled (for the costs to fix a new Closing Date and time, to coordinate the attendance of all persons, to re-date the closing documents and to recalculate the closing apportionments).
(ix) At closing, each purchaser shall pay to the Sponsor the sum of $[Amount] to defray the Sponsor’s costs of creating the condominium, e.g., architectural costs, filing fees, legal fees and other costs incurred in creating the condominium.
(x) At closing, the Sponsor will collect each purchaser’s pro-rated share in the first year’s insurance premium from the date of the closing until the end of the first year of condominium operation. This amount will be calculated in proportion to each purchaser’s common interest and will be used to reimburse the Sponsor for payment of the first year’s premium. Insurance premiums paid as part of common charges from closing until the end of the budget year will be retained by the Board to pay toward the premium for the next year. The pro-rated insurance adjustment collected by Sponsor will be in lieu of any other closing adjustments with the Board for insurance.
Rent Security Deposit
If Purchaser is or hereafter becomes a tenant of the Unit, Purchaser’s unapplied rent security deposit, if any, will be refunded to Purchaser, together with any interest earned thereon, within thirty (30) days following the closing, provided Purchaser is not in default under Purchaser’s lease or tenancy obligations. If the Unit is occupied by other than Purchaser, then the unapplied security deposit (if any) of the tenant or occupancy will be transferred at closing to Purchaser, who will upon receipt sign and deliver to Sponsor an agreement acknowledging the amount received, indemnifying Sponsor from all liability in connection therewith and agreeing to hold such security deposit in trust and to deposit same in an interest bearing bank account pursuant to the provisions of Section 7-103 of the New York General Obligations Law (such agreement to be in form and substance satisfactory to Sponsor). In either event, Sponsor will have the right to deduct from any tenant’s security deposit the amount of any rent arrearage owing to Sponsor and to sue the tenant to the extent such rent security is insufficient.
The Purchaser may not occupy the Unit or perform any work in the Unit prior to closing without the prior consent of the Sponsor. In the event the Purchaser occupies the Unit or performs any work in the Unit prior to closing without the prior consent of the Sponsor, such event shall constitute a default under Section 18 of this Agreement.
It is expressly understood and agreed that the Purchaser shall in no event take possession of the Unit prior to the time of the delivery of the deed (unless Seller agrees to give Purchaser an interim lease, which Seller is not obligated to give), and full compliance by the Purchaser with the terms of this Purchase Agreement, and should the Purchaser violate this provision, the Purchaser consents that the Sponsor shall have the right to remove him or her from the Unit as a squatter and intruder by summary proceedings. Upon the Purchaser’s unauthorized possession, the Purchaser shall be deemed in default hereunder at the option of the Sponsor, and if the Sponsor so elects, the Sponsor may cancel this Purchase Agreement and the amount deposited hereunder shall belong to the Sponsor as liquidated damages deemed earned hereunder, but not more than ten percent (10%) of the purchase price, together with amounts (if any) released to Sponsor to be used for special work, upgrades or extras, shall be paid over to the Sponsor as liquidated damages. Notwithstanding the above, the Sponsor may receive the actual costs incurred for any special work, upgrades or extras ordered by Purchaser as a part of its liquidated damages even though the total amount of liquidated damages thereby exceeds ten percent (10%) of the purchase price plus interest. It is further understood and agreed that the Sponsor will not be responsible for damage or loss to any property belonging to Purchaser whether same is delivered to the Property before, on or after the closing of title herein. Sponsor may, in its discretion, grant Purchaser possession of the Unit prior to Closing under an Interim Use and Occupancy Agreement, if the Unit is currently or hereafter becomes vacant.
Power of Attorney to Board of Managers and Sponsor
At closing, Purchaser shall execute, acknowledge and deliver to the representative of the title insurance company insuring Purchaser’s title to the Unit (or if no representative is present, then to Sponsor’s attorney) for recording in the Kings County Clerk’s Office, a power of attorney in favor of the Board of Managers relative to purchasing or leasing of Units and in favor of Sponsor relative to amending the Condominium Documents to the extent permitted in the power of attorney. The power of attorney shall be substantially in the form set forth in Document Number 4 in Part II of the Plan. After being recorded, the power of attorney shall be sent to the Condominium Board.
Transfer Tax Return
At closing, Sponsor and Purchaser shall each duly complete and sign before a Notary Public the transfer tax return required to be filed with The State of New York. The transfer tax return shall be delivered at closing to the representative of Purchaser’s title insurance company (or, if none, to Sponsor’s attorney) for filing with the proper governmental officer.
Events of Default
The following shall constitute “Events of Default” hereunder:
(i) Purchaser’s failure to pay the Balance on the Closing Date designated by Sponsor pursuant to paragraph 8 herein;
(ii) Purchaser’s failure to duly sign, notarize and deliver at closing the power of attorney pursuant to paragraph 16 above or the New York State transfer tax return pursuant to Paragraph 17 above;
(iii) If Purchaser is or becomes a tenant of the Building, Purchaser’s failure to pay rent or to otherwise comply with Purchaser’s lease or tenancy obligations, which results in Purchaser’s eviction from Purchaser’s Unit (either by voluntary removal or by court order); or
(iv) If Purchaser occupies the unit or performs any work in the unit prior to closing without the prior consent of the Sponsor;
(v) The failure to pay, perform or observe any of the Purchaser’s other obligations hereunder, which is not cured within thirty (30) days after the mailing of written notice specifying the nature of such default.
Upon the occurrence of an Event of Default, the Sponsor’s sole remedy shall be to cancel the Purchase Agreement by sending Purchaser thirty (30) days’ prior written notice of its intention to do so. If Sponsor elects to cancel, Purchaser shall have thirty (30) days from the giving of the cancellation notice within which time Purchaser must cure the specified default. If the default is not timely cured, then Sponsor shall have the right to retain, as and for liquidated damages, the Down Payment (but in no event to exceed ten percent (10%) of the Purchase Price of the unit) plus the cost of any special work in the Unit ordered by Purchaser and expended by the sponsor from the amount Purchaser delivered therefore, (hereinafter called the “Liquidated Sum”) and any sums in excess thereof (together with any interest earned thereon) shall be returned to Purchaser promptly thereafter. Upon cancellation of this Agreement and making such refund to Purchaser (if any), Purchaser, Sponsor and Selling Agent will be released and discharged of all further liability and obligations hereunder and under the Plan. Thereafter, the Unit may be sold to another as though this Agreement had never been made, and without accounting to Purchaser for the proceeds of such sale.
Upon cancellation of this Agreement and making such refund to Purchaser (if any), Purchaser, Sponsor and Selling Agent will be released and discharged of all further liability and obligations hereunder and under the Plan. Thereafter, the Unit may be sold to another as though this Agreement had never been made, and without accounting to Purchaser for the proceeds of such sale.
In the event that a purchaser does not close on the Closing Date set forth in the Notice of Closing, and Sponsor elects not to cancel the Purchase Agreement or if the Sponsor approves the Purchaser’s request to adjourn the Purchaser’s closing to his apartment, interest shall accrue on the unpaid amount of the purchase price from the Closing Date until such amount is paid. The interest rate shall be eight percent (8%) per annum. This rate shall be in effect for as long as there is any unpaid amount owing towards the full purchase price.
Notwithstanding the occurrence of an Event of Default Sponsor may, in its sole discretion, keep this Agreement in effect and proceed to close title without prejudicing Sponsor’s right to recover from Purchaser’s damages, losses, costs, expenses and all other lawful sums to which Sponsor is entitled (including, but not limited to, legal fees and costs of collection).
If Purchaser is or becomes a tenant of the Building and Purchaser fails to pay rent or otherwise comply with Purchaser’s lease or tenancy obligations, or Purchaser vacates or abandons the leased premises, then such failure, vacating or abandonment (as the case may be) shall constitute a default hereunder entitling Sponsor, at its sole option, to cancel this Agreement, even though Purchaser is not evicted from the leased premises as a result thereof. However, in the event Sponsor elects to so cancel, unless Purchaser is evicted, Sponsor shall refund to Purchaser all monies deposited hereunder together with any interest earned thereon. Upon such refund being made, Sponsor and Purchaser will be released and discharged of all further liability and obligations under this Agreement and the Plan. However, in no event shall Purchaser be released or excused from paying and performing Purchaser’s lease or tenancy obligations.
Appliances and Equipment
The Unit is being sold unfurnished, without window blinds or shades and will contain only the appliances and equipment described in the Plan. Furniture, wall coverings, furnishings, decorations, and the like in or about any model Unit are for display purposes only and are not included in this sale. Any floor plans or sketches shown to Purchaser (including those contained in the Plan) are only approximations of the Unit’s dimensions and arrangement, and Purchaser should not rely thereon. Sponsor shall not be liable for immaterial variations from any floor plans or sketches.
There will be no modifications or extras unless agreed to in writing by the parties. All modifications and alterations must be approved by Sponsor in writing and, if approved, shall be performed by Sponsor at Purchaser’s expenses (payable in the manner to be set forth in an addendum to this Agreement or separate agreement).
The construction of the Building and the Unit, including the materials, equipment and fixtures to be installed therein, shall be in accordance with the Plan and the architectural “plans and specifications” (defined in the Plan), subject to the right reserved by Sponsor to modify and amend the Plan and the “plans and specifications” in order to substitute materials, equipment or fixtures of equal or better quality and design, provided only that the approval of any governmental authorities having jurisdiction thereover and the construction lender are first obtained (if required). The issuance of a Certificate of Occupancy for the Building shall be deemed presumptive evidence that the Building and the Unit have been fully completed in accordance with the Plan and the “plans and specifications”. However, nothing herein contained shall excuse Sponsor from its obligations to correct any conditions in construction in accordance with the conditions set forth in the Plan in the section entitled “Rights and Obligations of the Sponsor.”
B. The construction of the Building and the Unit and the correction of any conditions in construction to the extent required under the Plan are the sole responsibility of the Sponsor. Purchaser acknowledges and agrees that Sponsor will not be liable for, and will have no obligation to correct, certain variations from the Plan and “plans and specifications” as indicated in the Plan in subparagraph 9(a)) of “Rights and Obligations of Sponsor–Construction Obligations” and will only be responsible to correct any construction defects to the extent, and on the terms and conditions, set forth in subparagraph 5 of “Rights and Obligations of Sponsor: Construction Obligations.
Inspection of Unit
At least ten (10) days before the Balance is to be paid, the Selling Agent shall notify the Purchaser that the Unit is ready for inspection. Upon receipt of the notice, Purchaser shall promptly arrange an appointment with the Selling Agent to inspect the Unit before the lapse of such ten (10) day period. Purchaser or his duly authorized agent shall attend such inspection and shall complete, date and sign the Inspection Statement (in the form set forth as Exhibit C to this Agreement) and deliver same to the Selling Agent at the conclusion of the inspection. Failure of Purchaser either to arrange such appointment or to inspect the Unit within ten (10) days of receipt of said notice or to so sign and deliver the completed Inspection Statement, shall not excuse Purchaser from paying the Balance when due and shall constitute Purchaser’s full acceptance of the Unit. However, nothing herein shall relieve Sponsor of its obligations as set forth in the “Rights and Obligations of Sponsor — Construction Obligations” as set forth in the offering plan.
Notwithstanding anything to the contrary herein, Sponsor shall make a good faith effort to address any punch list items within a reasonable period of time after closing.
Possession; Risk of Loss
The sponsor assumes the risk of loss from fire or other casualty until the purchaser assumes the risk of loss by taking possession of the unit. Unless Purchaser now resides in the Unit, Purchaser shall not be entitled to occupy the Unit until the deed is delivered to Purchaser at closing. Sponsor may, in its discretion, grant Purchaser possession of the Unit prior to the closing under an interim lease, if the Unit is currently, or hereafter becomes, vacant.
If Purchaser is given possession of the Unit prior to Closing under an interim lease or otherwise, the Purchaser shall be solely responsible for any damage to, or loss or other condition in the Unit resulting from Purchaser’s use or occupancy, and Sponsor shall not be obligated to make any repairs to the Unit or its installations. However, until closing Sponsor will remain responsible to make those repairs required of it as a landlord under any existing or interim lease and, after closing, the Condominium Board will be responsible to make those repairs required of it under the Condominium Documents.
If during Purchaser’s occupancy the Unit is damaged by casualty or otherwise, the Purchaser shall assume the risk of loss and the obligation to repair the damage, unless the cause thereof originated outside the Unit and did not result from the acts of Purchaser or other occupants of the Unit or Purchaser’s guests, invitees or workmen. If Purchaser is obligated to repair the damage, then Purchaser’s failure to make such repair shall not excuse Purchaser from paying the Balance and accepting delivery of the deed. Purchasers should note that a Purchaser that takes possession prior to closing assumes the risk of losses not covered by insurance.
Except as provided in the preceding subparagraph C, all other risk of loss prior to closing has been assumed by Sponsor, but without any obligation or liability of Sponsor to repair the damage or restore the Unit. If Sponsor or (in the event the Declaration is filed) the Unit Owners elect to repair or replace the loss or damage, this agreement shall continue in full force and effect, Purchaser shall not have the right to reject title to the Unit or to receive a credit against, or abatement in, the Purchase Price, and Sponsor shall be entitled to a reasonable period of time to complete or to permit the Condominium Board to complete such repairs or replacements. Purchaser shall not be required to pay the Balance unless and until (i) the Unit has been substantially repaired to as near as reasonably possible to its condition immediately prior to the casualty and (ii) its essential services (such as gas, electricity, and heat) and a reasonable means of ingress and egress to the street have been restored. Any proceeds received from insurance or in satisfaction of any claim or action in connection with such loss, shall belong entirely to Sponsor (subject to the rights, if any, of the Condominium Board or other Unit Owners) and if such proceeds are paid to Purchaser, Purchaser shall promptly upon receipt turn them over to Sponsor. The provisions of the preceding sentence shall survive the closing.
In the event Sponsor notifies Purchaser that it does not elect to repair or restore the Unit or if the Unit Owners do not resolve to make such repairs or restoration pursuant to the Condominium’s By-Laws, this Agreement shall be deemed cancelled and of no further force or effect and Sponsor shall return to Purchaser all sums deposited hereunder, without interest (unless interest is earned), whereupon the parties shall be released and discharged from all obligations and liability hereunder and under the Plan, except that if Purchaser is then in default hereunder (beyond the applicable grace period, if any), Sponsor shall retain the Liquidated Sum pursuant to Paragraph 19 above. The Sponsor will notify the Purchaser within fifteen (15) days of its decision with respect to repairing the unit.
Purchaser acknowledges that Purchaser has not relied upon any architect’s plans, sales plans, selling brochures, advertisements, representations, warranties, statements or estimates of any nature whatsoever, whether written or oral, made by Sponsor, Selling Agent or others, including, but not limited to, any relating to the description or physical condition of the Property, the Building or the Unit, or the size or the dimensions of the Unit or the rooms therein contained or any other physical characteristics thereof, the services to be provided to Unit Owners or the estimated Common Charges and estimated real estate taxes for the Unit, the right to any income tax deduction for any real estate taxes or mortgage interest paid by Purchaser, or any other data, except as may be specifically represented herein or in the Plan; Purchaser having relied on Purchaser’s own examination and investigation thereof. No person has been authorized to make any representations on behalf of Sponsor. No oral representations or statements shall be considered a part of this Agreement. Purchaser agrees (a) to purchaser the Unit, without offset or any claim against, or liability of, Sponsor, whether or not any layout or dimension of the Unit or any part thereof, or of the Common Elements, as shown on the Floor Plans, is accurate or correct, provided the layouts and dimensions conform substantially to such Floor Plans and (b) that Purchaser shall not be relieved of any of Purchaser’s obligations hereunder by reason of any immaterial inaccuracy or error. The provisions of this Paragraph 24 shall survive the closing of title.
All notices, elections, consents, demands and communications (collectively called “notices” or individually called “notice”) shall be delivered personally or given in writing by registered or certified mail, return receipt requested, postage prepaid, and, if sent to Purchaser, addressed to Purchaser at Purchaser’s address given in the preamble to this Agreement and, if sent to Sponsor, addressed to the Sponsor.
Notice to Purchaser shall include E-MAIL transmission to Purchaser or Purchaser’s attorney. Seller’s attorney may send all notices to Purchaser’s attorney and/or Purchaser via E-MAIL at the following number(s):
[Lawyer Contact Information]
A E-MAIL confirmation printout by Seller’s attorney showing transmission was complete is sufficient evidence that the E-MAIL has been transmitted and the notice has been served.
Purchaser represents to Sponsor that [Brokers] are the only broker(s) or sales agent(s) with whom Purchaser has dealt in connection with this transaction. Sponsor agrees to pay the commission due the aforementioned selling agent(s) pursuant to separate agreement. Purchaser agrees that should any claim be made against Sponsor for commissions by any broker, other than the aforementioned selling agent(s), on account of any acts of Purchaser or of Purchaser’s representatives, Purchaser will indemnify and hold Sponsor free and harmless from any and all liabilities and expenses in connection therewith, including (without limitation) reasonable legal fees and disbursements. The provisions of this Paragraph 25 shall survive the closing.
No Lien; Agreement Subject to Mortgage
A. No lien or encumbrance shall arise against the Property or the Unit as a result of this Agreement or any monies deposited hereunder. This Agreement shall not be recorded and any purported recordation hereof by Purchaser shall constitute an Event of Default.
In furtherance and not in limitation of the provisions of the preceding subparagraph A, Purchaser agrees that the provisions of this Agreement are and shall be subject and subordinate to the lien of any mortgages heretofore or hereafter made and any payments or expenses already made or incurred or which hereafter may be made or incurred, pursuant to the terms thereof, or incidental thereto, or to protect the security thereof, to the full extent without the execution of any further legal documents by Purchaser. Sponsor shall, at its option, either satisfy such mortgages or obtain a release of the Unit and its undivided interest in the Common Elements from the lien of such mortgages on or prior to the Closing Date unless Purchaser assumes such mortgages. The existence of any mortgage or mortgages encumbering the Property, or portions thereof, other than the Unit and its undivided interest in the Common Elements, shall not constitute an objection to title or excuse Purchaser from completing payment of the Purchase Price or performing all of Purchaser’s other obligations hereunder or be the basis of any claim against, or liability of, Sponsor, provided that any such mortgage is subordinated to the Declaration and the Unit is released from the lien of such mortgage at closing.
This Purchase Agreement, together with the Plan, as the Plan may be amended from time to time, constitutes the entire agreement between the parties as to the subject matter hereof and supersedes all prior understandings and agreements.
The term “Purchaser” shall be read as “Purchasers” if more than one person are purchasers, in which case their obligations shall be joint and several.
Liability of Sponsor
Sponsor shall not have any liability to Purchaser or others with respect to any of Sponsor’s obligations under this Agreement or the Plan or otherwise in excess of the net proceeds paid to Sponsor from the sale of all Unsold Units after payment of, or reserve for, any liabilities, costs or expenses of Sponsor arising out of the promulgation of the Plan, the offering of the Units for sale and the consummation of the transactions contemplated in the Plan.
Sponsor shall be excused from performing any obligation or undertaking provided for in this Agreement for so long as such performance is prevented, delayed or hindered by an act of G-d, fire, flood, explosion, war, riot, sabotage, inability to procure or general shortage of energy, labor, equipment, facilities, materials, or supplies in the open market, failure of transportation, strike, lock-out, action of labor unions or any other cause (whether similar or dissimilar to the foregoing) not within the reasonable control of Sponsor. Sponsor’s time to perform such obligation or undertaking shall be tolled for the length of the period during which such performance was excused.
C. Disclaimers or limitations of liability on the part of the Sponsor or its principals for failure to perform any obligation imposed by applicable statute or regulation may not be included. The plan may not include any financial limitation on Sponsor’s liability for failure to perform its obligations under the offering plan. Sponsor and its principals are liable, without any financial limitation, for failure to perform any obligation imposed by applicable statute or regulation.
Either party shall execute, acknowledge and deliver to the other party such instruments and take such other actions, in addition to the instruments and actions specifically provided for herein, as such other party may reasonably request in order to effectuate the provisions of this Agreement or of any transaction contemplated herein or to confirm or perfect any right to be created or transferred hereunder or pursuant to any such transaction.
If any provision of this Agreement or the Plan is invalid or unenforceable as against person or under certain circumstances, the remainder of this Agreement or the Plan and the applicability of such provision to other persons or circumstances shall not be affected thereby. Each provision of this Agreement or the Plan, except as otherwise herein or therein provided, shall be valid and enforced to the fullest extent permitted by law.
Any failure by Sponsor to insist upon strict performance by Purchaser of any of the provisions of this Agreement shall not be deemed a waiver of any of the provisions hereof, irrespective of the number of violations or breaches which may occur, and Sponsor, notwithstanding any failure, shall have the right thereafter to insist upon strict performance by Purchaser of any and all of the provisions of this Agreement to be performed by Purchaser.
The provisions of this Agreement shall be governed by, and construed and enforced in accordance with, the Laws of the State of New York.
A reference in this Agreement to any one gender, masculine, feminine or neuter, includes the other two, and the singular includes the plural, and vice versa, unless the context otherwise requires.
The term “herein”, “hereof” or “hereunder” or similar terms used in this Agreement refer to this entire Agreement and not to the particular provision in which the term is used. Unless otherwise stated, all references herein to Paragraphs, subparagraphs or other provisions are references to Paragraph, subparagraphs or other provisions of this Agreement.
The captions in this Agreement are for convenience and reference only and in no way define, limit or describe the scope of this Agreement or the intent of any provisions hereof.
Successors and Assigns
The provisions of this Agreement shall bind and inure to the benefit of Purchaser and Purchaser’s heirs, legal representatives, successors and permitted assigns and shall bind and inure to the benefit of Sponsor and its successors and assigns.
No Oral Changes
This Agreement cannot be changed nor any provision waived orally. ANY CHANGES OR ADDITIONAL PROVISIONS OR WAIVERS MUST BE SET FORTH IN A RIDER ATTACHED HERETO OR IN A SEPARATE WRITTEN AGREEMENT SIGNED BY THE PARTIES.
Acceptance of Purchase Agreement
On or prior to Purchaser’s signing and delivering this Purchase Agreement, Purchaser agrees (if requested) to complete, sign and deliver to the Selling Agent an application form furnished by Sponsor. Such application shall be used to determine Purchaser’s qualification to purchase and own the Unit, but does not constitute a reservation or binding obligation on either the applicant or Sponsor.
The submission of such application or this Purchase Agreement to Purchaser does not constitute a binding obligation on either Purchaser or Sponsor. No such binding obligation shall arise until duplicates of this Purchase Agreement are executed by, and delivered to, both Purchaser and Sponsor (or Sponsor’s duly authorized agent). If, within twenty (20) days after the Selling Agent receives this Purchase Agreement signed by Purchaser, a duplicate of this Agreement signed by Sponsor or its authorized agent is not sent or delivered to Purchaser, then it shall be deemed rejected and of no force or effect, and all monies paid by Purchaser shall be promptly refunded, without interest. Upon such refund being made, neither party shall have any further rights, obligations or liabilities hereunder with respect to the other. Sponsor has the right, without incurring any liability, to reject this Agreement without cause or explanation to Purchaser. This Agreement may not be rejected due to Purchaser’s sex, race, creed, color, national origin, ancestry, disability, marital status or other ground proscribed by law.
40. Purchase Agreement Not Conditioned on Financing.
Purchaser may partially finance the purchase of this unit by obtaining a mortgage loan for the purchase price. However, the obligations of purchaser under this Purchase Agreement are not conditional on the purchaser’s obtaining financing unless Sponsor permits Purchaser to complete the Financing Contingency Rider, and Purchaser and Sponsor do in fact execute such Rider.
41. Agreement Not Assignable; Binding Effect
This Purchase Agreement is not assignable without the consent of the Sponsor.
This Purchase Agreement shall bind and apply to Purchaser and Purchaser’s executors, administrators, legal representatives, heirs, successors and permitted assigns.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.
EXHIBIT A: PERMITTED ENCUMBRANCES
Title to each Residential Unit and its Common Interest will be conveyed at the closing of title to such Residential Unit free and clear of all liens, encumbrances, and title exceptions other than those described in the proposed Unit Deed and the title exceptions and other matters set forth below (collectively the “Permitted Encumbrances”):
Building restrictions and zoning laws and other regulations, resolutions and ordinances and any amendments thereto now or hereafter adopted by any governmental or quasi-governmental authority having jurisdiction.
Title exceptions may include the state of facts shown on a stated survey and any additional state of facts a subsequent survey would show, provided that such additional state of facts does not render title unmarketable.
Zoning regulations, ordinances, building restrictions and regulations;
Consents by Sponsor or any former owner of the Property for the erection of any structure or structures on, under or above any street or streets that the Property may abut;
Encroachments of the Building, walls, stoops, steps, balconies, ornamental columns, windows, door caps, keystones, ledges, pilasters, coping, trim and cornices, and any other part thereof, if any, upon any street or highway or upon any adjoining property and similar encroachments upon the Property;
Sewer, water, electric, plumbing, heating, gas, telephone and other utility easements and consents, if any, then or thereafter recorded, including the right to maintain and operate lines, wires, cables, amplifiers, transformers, pipes, conduits, poles, meters and distribution boxes in, over, under and upon the Property and the Building;
The lien of any mortgage, lien or other encumbrance granted, created, or obtained by the Purchaser;
Easements for ingress and egress for construction, installation, operation and maintenance of municipal service facilities and utilities. Any easement or right of use in favor of handicapped persons or any easement or right of use in favor of any utility company for electricity, steam, gas, telephone, water, or other service, and the right to construct, use, maintain, repair, and replace all utility lines, wires, terminal boxes, mains, pipes, cables, conduits, poles, connections and other equipment and facilities on, under and across the Land and Building.
Any Party walls and party wall agreements;
Any other covenants, restrictions, easements, or any other encumbrance (other than for the payment of money), provided that they do not prohibit the existence and use of such Residential Unit;
Revocability of licenses for vault space, if any, under the sidewalks and streets and the lien of any unpaid vault tax (which is to be paid by the Condominium Board);
The lien of any Common Charges and Special Assessments, real estate taxes, water frontage and/or meter charges, sewer rents, vault charges and assessments, provided that apportionment of such items is made as provided in the Section of the Plan entitled “Unit Closing Costs and Adjustments”;
Eases and service, maintenance, employment, concessionaire and license agreements, if any, of other Units or portions of the Common Elements. Service, labor, concessionaire and maintenance agreements contemplated under the Plan;
Any Interim Lease with the Purchaser for such Residential Unit and any other leases, tenancies and occupancies permitted by the Purchase Option Agreement for such Residential Unit;
Any lien, notice of pendency or other encumbrance either (i) for which the instrument required to remove said lien, notice of pendency or other encumbrance of record is delivered at or prior to the date of closing of title to the Residential Unit, together with the required recording or filing fee, to the proper party or to the Purchaser’s title insurance company, or (ii) as to which the Purchaser’s title insurance company will insure that the lien, notice of pendency or other encumbrance will not be collected out of or enforced against the Residential Unit;
The lien of any assessment or assessments that are or may become payable in annual installments of which any installment is then a charge or a lien, provided that apportionment thereof is made as provided in the Section of the Plan entitled “Unit Closing Costs and Adjustments”;
Judgments, bankruptcies or other returns against other persons having names the same as or similar to that of Sponsor or any of its principals, provided Sponsor or any such principals, as the case may be, deliver to the Purchaser or the Purchaser’s title insurance company an affidavit showing that such judgments, bankruptcies or other returns are not against Sponsor or any such principals, as the case may be;
Uniform Commercial Code financing statements or conditional bills of sale, provided that (i) such statements were filed on a date more than five years prior to the closing of title to the Unit, (ii) Sponsor executes and delivers to the Condominium an affidavit setting forth that the property covered thereby is no longer in the Residential Unit or is fully paid for, or (iii) a tenant is the debtor thereunder;
Sidewalk violations and any other violations against the Property that are the obligation of any Board or another Unit Owner to correct.
All of the terms, burdens, easements, covenants, restrictions, conditions and rules and regulations set forth in the Declaration, the By-Laws (and the Rules and Regulations made thereunder), the Residential Unit Owner’s Power of Attorney and the Floor Plans, all as may be amended from time to time; and
The standard exceptions contained in the form of fee title insurance policy then issued by the title insurance company insuring Purchaser’s title to the Residential Unit.
Any encumbrance as to which the title insurance company which insures Purchaser’s title to the Unit would be willing, in a fee policy issued by it to Purchaser, to insure Purchaser, without the payment of any special premiums or additional cost to Purchaser, that such encumbrance (a) will not be collected out of the Unit if it is a lien and (b) will not prevent the use of the Unit for dwelling purposes.
Any lease covering the Unit.
Certificate of Occupancy to be issued covering the unit if required.
Any violations against the Property (other than the Unit) which are the obligation of the Condominium Board or another Unit Owner to correct.
Encroachments of shrubbery, stoops, areas, steps, doors, ledges, window sills, trim, copings, retaining walls, bay windows, balconies, sidewalk elevators, fences, fire escapes, cornices, foundations, footings, chutes, fuel oil lines, drainage and stand pipes, sewerage pipes, air-conditioning units, canopies, ramps, and similar projections, if any, on, over, or under the Property or the streets or sidewalks or property abutting the Property and the rights of governmental authorities and adjoining property owners to require the removal of any such projections and variations between record lines of the Property and retaining walls and the like, if any.
Sponsor will not be obligated to bring any action or proceeding or otherwise incur any cost or expense in excess of its obligations under the Plan to cure any inability to deliver title to a Residential Unit in accordance with the Plan and the terms of the Purchase Option Agreement for such Residential Unit. If Sponsor notifies a Purchaser of its refusal to cure any such inability, then such Purchaser’s sole remedy will be either (a) to take such title as Sponsor is able to deliver without abatement in or credit against the Purchase Price for the Residential Unit and without any claim or right of action against Sponsor for damages or otherwise or (b) to terminate his Purchase Option Agreement and receive a refund of his Down Payment and any interest earned thereon. A Purchaser must notify Sponsor in writing as to which option such Purchaser elects within ten (10) days after the giving of Sponsor’s notice of refusal to cure such inability, with TIME BEING OF THE ESSENCE. If a Purchaser fails to timely deliver such notice, it will be conclusively deemed that such Purchaser has elected to acquire title to the Unit subject to such inability as set forth in clause (a).
EXHIBIT B: TERMS OF FINANCING CONTINGENCY RIDER
THE TERMS SET FORTH IN THIS FINANCING CONTINGENCY RIDER SHALL APPLY, AT SELLER’S SOLE OPTION, ONLY IF AGREED TO BY THE SPONSOR IN THE SPACE PROVIDED BELOW. PURCHASER’S SIGNATURE ALONE DOES NOT EFFECTUATE THIS FINANCING CONTINGENCY RIDER.
THIS RIDER IS ANNEXED TO AND FORMS A PART OF THE PURCHASE AGREEMENT, DATED ________________________, 2017 BETWEEN [Sponsor], SELLER, AND ________________, PURCHASER, RELATIVE TO THE SALE OF UNIT _______ AT THE [Address] CONDOMINIUM, [Address], BROOKLYN, NEW YORK.
Purchaser shall submit a loan application to Sponsor’s Preferred Mortgagee: [Preferred Lender Contact Information]. Purchaser may also apply to a lender (and close with said lender) at Purchaser’s cost. However, if Purchaser chooses to apply to a lender other than Sponsor’s Preferred Mortgagee, and shall not also apply with Sponsor’s Preferred Mortgagee, this mortgage Financing Contingency Rider shall be of no force and effect and be deemed extinguished. If Purchasers are denied by the lender of their choice but are approved by Sponsor’s Preferred Mortgagee at prevailing rates for a thirty (30) year fixed mortgage, Purchaser shall close with Sponsor’s Preferred Mortgagee or be deemed in default of the Purchase Agreement. If Purchaser is approved by both Sponsor’s Preferred Mortgagee and the lender of Purchaser’s choice, Purchaser may close with either lender.
Within two (2) weeks of Purchaser’s attorney receiving a fully executed Purchase Agreement Purchaser must make a mortgage application. Within seven (7) days thereafter, the Purchaser must provide the Seller and/or Seller’s attorney with the name and address of the bank or mortgage broker to which application has been made. Seller and/or Seller’s attorney shall be permitted to deal directly with Purchaser’s bank or mortgage broker. Failure to send such notice will be considered to be a waiver of the financing contingency.
The obligations of Purchaser hereunder are conditioned upon issuance on a date which is on or before forty-five (45) days from date Purchaser’s Attorney receives a fully executed Purchase Agreement (“Financing Contingency Expiration Date”), of a written commitment from an Institutional Lender (which shall include a mortgage banker and broker) pursuant to which such Institutional Lender agrees to make a first mortgage loan to Purchaser, at Purchaser’s sole cost and expense, of an amount equal to 75% of the purchase price or such lesser sum as Purchaser shall be willing to accept, at prevailing interest rates for a term of at least thirty (30) years and on other customary commitment terms, whether or not conditional upon any factors other than an appraisal satisfactory to the Institutional Lender.
Purchaser shall (a) make an application within two (2) weeks of Purchaser’s attorney receiving a fully executed Purchase Agreement, (b) furnish accurate and complete information regarding Purchaser and members of Purchaser’s family, as required, (c) pay all fees, points and charges
required in connection with such application and loan, (d) pursue such application with diligence, (e) cooperate in good faith with such Institutional Lender to obtain such commitment and (f) give notice within three (3) weeks to Seller of the name and address of each Institutional Lender to which Purchaser has made such application. Purchaser shall comply with all requirements of such commitment (or of any other commitment accepted by Purchaser) and shall furnish Seller with a copy thereof promptly after receipt thereof.
If such commitment is not issued on or before the Financing Contingency Expiration Date, or a rejection is received, Purchaser shall within five (5) days of the Financing Contingency Expiration Date or rejection date, notify the Seller of the failure to receive a commitment or of the rejection and at such time, Purchaser in the event he was approved by the Preferred Mortgagee, must close with Preferred Mortgagee or be deemed in default, or in the event he was denied by both lenders, may cancel this contract by giving notice to Seller, in which case this contract shall be deemed cancelled and thereafter neither party shall have any further rights against or obligations or liabilities to, the other by reason of this contract and the down payment shall be promptly refunded to Purchaser. Provided, however, that at such time, the Seller, at its option, shall within fifteen (15) days, cause the Purchaser to submit an application together with the required fees to the Preferred Mortgagee if the Purchaser did not do so within two (2) weeks of receiving a fully executed Purchase Agreement with Sponsor’s consent, and Purchaser shall be required to accept the commitment under terms equal to or better than the terms originally sought by the purchaser.
If Purchaser fails to give notice of cancellation, then Purchaser shall be deemed to have waived Purchaser’s right to cancel this contract and to receive a refund of the Down payment by reason of the contingency contained in this Rider and the financing contingency will no longer apply. In addition, if Purchaser fails to notify Seller within fifty (50) days of Purchaser’s attorney receipt of a fully executed Purchase Agreement that he has received a commitment, Seller may at its option cancel the contract and thereafter neither party shall have any further rights against or obligations or liabilities to, the other by reason of this contract, and upon cancellation the down payment shall be promptly refunded to Purchaser.
Provided that the purchaser complies with all of the above terms, if the financing commitment lapses or expires prior to closing and the purchaser has made a good faith effort to extend the commitment, the Sponsor will grant to purchaser a right of rescission and a reasonable period of time to exercise such right.
A purchaser seeking financing will be responsible for all fees and costs imposed by the lender, including (but not limited to) appraisal and origination fees (if any).
In accordance with the Financing Contingency, the purchaser will have the right to terminate the Purchase Agreement and be refunded all monies deposited thereunder, without interest, in the event:
an institutional lender fails, through no fault of the purchaser, to issue its commitment on the terms described above within forty (45) days from Purchaser’s attorney’s receipt of the fully executed Purchase Agreement (or such greater period as the Sponsor may permit, in
Sponsor’s sole discretion), provided the purchaser gives notice of termination not later than five (5) days after the expiration of the aforementioned period; or
the commitment issued by the lender is not funded by the closing through no fault of the purchaser, provided the purchaser gives notice of termination no later than ten (10) days before the closing.
In the event purchaser fails to exercise the right of termination within time periods set forth above or has failed to satisfy the conditions set forth in the Financing Contingency Rider, then, in either case, the Purchase Agreement shall remain in full force and effect.
EXHIBIT C: INSPECTION STATEMENT
Ladies and Gentlemen,
As a result of my/our final inspection on this date, please be advised that, except as otherwise noted on the attached sheet, I/we found the Unit in good condition:
I/we understand that to avoid the risk of pilferage, certain items such as medicine cabinet doors, shower heads, toilet seats, kitchen cabinets, vanity knobs, mechanical chimes, plumbing fittings, light fixtures, electrical receptacles, toilet room accessories, door hardware and ____________________________________, may be installed just prior to my/our date of moving. I/we agree and I/we will sign off on each item requiring adjustment or repairs, if any, as it is completed.
I/We agree that I/we will promptly initial each item set forth on the attached inspection sheet as it is completed to acknowledge completion. My/Our failure to respond to you within five (5) business days of your written request for such acknowledgment shall be deemed to mean that I/we have accepted and acknowledged the work as complete. I/We understand that work indicated on the inspection sheet shall be performed in accordance with the practice of the industry. In the event of a dispute, Sponsor’s contractor, architect or engineer shall determine whether or not such work was performed according to such standard and his or her decision shall be binding on the parties hereto.
You agree to complete all items listed on this inspection statement within a reasonable period of time following closing to my/our Unit, subject to delays for work or materials beyond your control.
This Inspection Statement shall survive closing of title to my/our Unit.
1 If one purporting to be the Purchaser’s agent signs to acknowledge completion, the Sponsor shall be entitled to rely on such signature as acknowledgment of completion and Purchaser shall be bound thereby.
EXHIBIT D: SPONSOR’S LIMITED WARRANTY
THIS LIMITED WARRANTY HAS BEEN FORMED IN ACCORDANCE WITH ARTICLE 36-B OF THE GENERAL BUSINESS LAW, OTHERWISE KNOWN AS THE HOUSING MERCHANT IMPLIED WARRANTY.
EFFECTIVE DATE OF THIS LIMITED WARRANTY
The effective date of this limited warranty is the earlier of the (i) date that purchaser shall first take possession of the Unit or (ii) the date of delivery of the condominium unit deed to the purchaser.
SPONSOR’S LIMIT ON MAXIMUM LIABILITY
The Sponsor’s maximum liability to purchaser under this limited warranty is limited to fifty percent (50%) of the purchase price of the unit set forth in the purchase agreement to which this limited warranty is annexed as Exhibit D.
THIS LIMITED WARRANTY REPLACES ALL OTHER WARRANTIES ON THE CONSTRUCTION AND SALE OF THE UNIT AND ALL COMPONENTS THEREOF, BOTH EXPRESS AND IMPLIED (INCLUDING BUT NOT LIMITED TO, ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE). THE PURPOSE OF THIS LIMITATION IS TO IDENTIFY THE SELLER’S RESPONSIBILITIES FOR LATENT CONSTRUCTION DEFECTS THAT COULD NOT HAVE DISCOVERED OR DISCLOSED BY AN INSPECTION OF THE UNIT.
THIS LIMITED WARRANTY EXCLUDES ANY CONSEQUENTIAL, INCIDENTAL, SPECIAL AND INDIRECT DAMAGES.
THOSE COVERED UNDER THIS LIMITED WARRANTY
This Limited Warranty extends to the purchaser named on page 1 of this purchase agreement and its successors whom acquire title to the Unit by will or intestacy. This Limited Warranty does not extend to subsequent owners, possessors, lessees, mortgagees in possession of the Unit or any person(s) or entity(ies) who may succeed to the rights of the herein purchaser.
LIMITED WARRANTY IS GIVEN BY SPONSOR
This Limited Warranty is made solely by the Sponsor of this condominium, whose name appears on page 1 of this purchase agreement.
PURCHASER’S OBLIGATION TO INSPECT THE UNIT
Purchaser assumes and undertakes the responsibility to inspect the Unit prior to acquisition of title and prior to occupancy. Any defects discovered upon inspection or which may be discovered by an inspection of the Unit shall be reported to the Sponsor prior to closing of title or will be deemed waived indefinitely.
The Warranty period for all of the following coverages begins on the effective date of this Warranty set forth herein above.
(i) For one (1) year, the home must be free from defects caused by workmanship or materials that do not meet the standards of the applicable building code; for items not covered by code, the construction must be in accordance with locally accepted building practices.
(ii) For two (2) years, the plumbing, electrical, heating, cooling and ventilation systems must be free from defects caused by unskillful installation.
(iii) For six (6) years, the home must be free from physical defects in the structural elements (foundation, floors, walls, roof framing).
NOT COVERED BY THE HOUSING MERCHANT IMPLIED WARRANTY
(i) A defect not caused by defective workmanship, materials or design.
(ii) Defects in items sold with the home, such as stoves, refrigerators, air conditioners, etc. There are implied warranties from the manufacturers of such goods which are described in other laws.
EXCLUSIONS FROM COVERAGE
The Sponsor’s total and maximum liability to any unit owner under the Sponsor’s Limited Warranty is limited to fifty percent (50%) of the purchase price of the unit.
The Sponsor’s Limited Warranty excludes all consequential, incidental, special damages and indirect damages.
The Sponsor’s Limited Warranty does not cover defects in appliances, fixtures, equipment and household items, except defects due to improper installation by the Sponsor.
The Sponsor’s Limited Warranty does not cover any defects for any labor or in any work or materials ordered directly by any purchaser from Sponsor’s sub-contractors, suppliers, or any independent contractor not engaged in any non-delegable duty(ies).
The Sponsor’s Limited Warranty is limited to actual purchasers and their successors whom acquire title to the subject Unit by will or by the governing intestacy laws.
In addition, the following items are not covered by the Sponsor’s Limited Warranty:
conspicuous defects and any defects which an inspection of the Unit would reveal;
damage caused by the failure of the purchaser or any affiliate thereof, to comply with the requirements of the Sponsor’s Limited Warranty or of any requirements imposed by a manufacturer, supplier of appliances, fixtures, equipment or household items;
iii. damage caused by the misuse, overuse, or interference by purchaser or anyone other than the Sponsor or its employees or delegatees;
any additional damage caused by the failure of purchaser to give adequate notice to the Sponsor of any defects or damage in a timely fashion as provided in the Sponsor’s Limited Warranty;
any damage caused by changes, alterations or improvements made to the Unit by anyone other than the Sponsor or its employees or delegatees;
any damage caused by purchaser’s failure to adequately maintain and preserve any item or property covered under the Sponsor’s Limited Warranty;
vii. any loss or damage caused by or stemming from an accident, catastrophe, unnatural forces due to violence or gross negligence, fire, explosion, smoke, motor vehicles, acts of God, lightening, windstorm, hail, flood, earthquake, soil movement, and changes in the underground waterbase;
viii. any loss or damage caused by seepage of water unless such loss or damage is directly related to a construction defect resulting from construction by the Sponsor;
any damage resulting from purchaser’s failure to take timely action to mitigate any pre-existing damages;
any condition resulting from normal wear and tear or form normal settling of the building, including but not limited to, concrete cracks, outer building cracks which do not impair the structural stability of the building;
insects, vermin, rodent damage and infestation, or damage caused by other animals or pests;
xii. death, bodily injury or damage to personal property;
xiii. damage which arises from any misuse or unauthorized use of the Unit.
Purchasers must give notice of defects in their home in writing no later than thirty (30) days after the end of the warranty period.
SPONSOR’S OBLIGATIONS IN THE EVENT OF A DEFECT COVERED UNDER THIS WARRANTY
If a defect occurs in an item covered under this warranty, the Sponsor will make a good faith effort to repair, replace or pay the purchaser the reasonable cost of repairing or replacing the defective item(s) within ninety (90) days after Sponsor’s inspection of the alleged defect which discloses an actual defect covered under this limited warranty. The Sponsor reserves the sole right and discretion to replace, repair or furnish payment for any defect.
The Sponsor’s maximum liability under this warranty is limited to fifty percent (50%) of the purchase price of the Unit as set forth in the purchase agreement to which this exhibit is annexed.
Repair of any damage to the load bearing portions of the Unit or Building will be limited to that which is necessary to restore their load bearing functions.
COMPLETION AND DELIVERY OF NOTICE OF WARRANTY CLAIMS WITHIN THIRTY (30) DAYS AFTER THE EXPIRATION OF THE APPLICABLE WARRANTY PERIOD IS NECESSARY TO PROTECT THE RIGHTS OF THE PURCHASER UNDER THIS LIMITED WARRANTY. ALL TIME PERIODS FOR SAID COVERAGES ARE OF THE ESSENCE AND WILL NOT BE EXTENDED BY THE SPONSOR.
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