Signature Tower Reservation Agreement

[gusrock1414]

I just wanted someone to clarify for me concerning ST contract. So you can put $5,000 down for the first few floors to have the right to execute the contract by October 2006? On October 2006, you either put 7 percent down for the place or you lose it? Is that correct.

I think it might be worth the risk to only put 5k (low risk for high reward)down but you are probably not going to get a lot of price appreciation until the construction starts. What does everyone think about these condos as investments?

[tistic]

I just wanted someone to clarify for me concerning ST contract. So you can put $5,000 down for the first few floors to have the right to execute the contract by October 2006? On October 2006, you either put 7 percent down for the place or you lose it? Is that correct.

I think it might be worth the risk to only put 5k (low risk for high reward)down but you are probably not going to get a lot of price appreciation until the construction starts. What does everyone think about these condos as investments?

Section 4 of the contract sets out the timelines--the contract ends by its terms at the earlier of (A) the purchaser's request for his money back, (B) 21 days after Tony is ready to do a deal and delivers a contract and info package to the purchaser, otherwise the purchaser loses their reservation and someone else steps in to buy, or ( C ) the last day in October. In any event Purchaser can get his reservation money back if he wants.

If sales are going very well, according to the reservation agreement Tony could actually come forward the day after the reservation and start the 21 day clock ticking. But it's in Tony's interest to keep his customers informed of his timelines so everyone is ready at the same time.

No matter what floor you're on, the earnest money due at contract signing is 5% of the negotiated purchase price, with a second earnest money payment of 2% due at "topping out" of the building. Once the seller & purchaser reach a deal, the "reservation deposit" is almost certainly to be applied to the amount of earnest money due. That isn't specified by the language of the reservation contract but is probably standard for deals like this---ask `em to be sure.

I don't know if that's clearer than the two page agreement, but I hope it helps. If you're gonna do this or any real estate transaction, let me recommend the attorneys of Baker Donelson.

Don't treat anything as legal advice if it comes from a stranger wearing a balaclava, even if he says he has a law degree.