What does a purchase agreement cost? If you are entering a transaction involving a buyer and a seller, you may want to know how much a purchase agreement will cost. Let’s explore this question and review general information about purchase agreements and their implications.
How Much Does a Purchase Agreement Cost?
A purchase agreement, a sales agreement, a sales contract, or an agreement for the sale of goods contract is a legally binding agreement between a party selling an item and the party purchasing the item. Purchase agreements are often used in real estate but can be used for smaller transactions and are recommended for any transaction over $500.
A purchase agreement’s main purpose is to protect the buyer and the seller in a business transaction. The agreement will describe the following:
- The item being sold
- Its condition, price
- Any other terms and conditions associated with the transaction
Some everyday transactions that usually require a purchase agreement include:
- Real estate purchases
- Large volume purchases
- Purchase of equipment
- Motor vehicle purchases
There is much risk when two parties enter a high-value transaction like selling or buying a house. For this reason, many people choose to hire a contract lawyer to draft a purchase agreement.
A contract lawyer will know what terms and conditions to include in your purchase agreement to protect both parties and make the agreement legally binding. However, if the contract is poorly written or doesn’t contain all the necessary terms, you could suffer financial consequences.
Based on ContractsCounsel’s marketplace data, the average cost of a project involving a purchase agreement is $760.00.
What’s Included in a Purchase Agreement
The terms and conditions included in a purchase agreement will vary based on the transaction. For example, a purchase agreement for the sale of a house will be very different from a purchase agreement for a motorcycle.
No matter what kind of item is being sold, a basic purchase agreement should include the following clauses:
- Party information. The names, business names, and contact information of all parties involved in the transaction.
- Sale inclusions and exclusions. Information about the items or assets involved in the transaction. This should include a description of things and, if the sale involves real estate, all inspection requirements, appraisals, financing, and titling information.
- Disclosures. Any information about the item being sold that could impact the value.
- Payment and pricing. How much does the asset or property cost, and what are the terms and conditions surrounding the payment. This should include all payment terms agreement options (cash, loan, etc.) and dates of transactions.
- Delivery of goods. This clause details how certain items like a car or furniture that require delivery will be delivered to the buyer. Specific information like delivery cost, time, place, and liability for damages should all be addressed.
- Warranties. Warranties are guarantees that a seller makes a buyer that the item being purchased meets the expected level of reliability. This legally enforceable guarantee can be made as an express or implied warranty. An express warranty is an affirmative statement about the quality of the goods. For example, “the car starts and runs without any issues.” An implied warranty is an unwritten guarantee, like the assumption that the car you are about to buy will work properly. Either warranty can be written or oral, but it is always better to have the warranty written into the contract.
- Signatures. Both the buyer and the seller need to sign the purchase agreement.
Why Do I Need a Purchase Agreement?
Purchase agreements are important legal contracts for both large and small transactions. The agreement will protect the seller because the buyer agrees to purchase an item for a set price under specific terms and conditions.
The buyer will be protected because the purchase agreement serves as a receipt for the transaction proving they rightfully own the property detailed in the agreement.
A correctly written purchase agreement will be legally enforceable. However, suppose either party fails to uphold their end of the bargain. In that case, the injured party can seek legal relief through a lawsuit for breach of contract.
Purchase Agreement Projects
Purchase Agreement Drafting
Sales contracts are important documents because they lay out the terms and conditions surrounding a sale or transaction between a buyer and a seller. Without a valid sales contract, both parties risk financial harm if either party misrepresents an item or fails to uphold their end of the bargain.
For these reasons, it is common for individuals or companies selling or purchasing goods to hire an attorney to draft a valid purchase agreement. An experienced attorney will know the contract laws in your state and be able to create a document customized to your needs that protects both you and the other party in the transaction.
Purchase Agreement Review
It is typical for the seller or service provider to provide the purchase agreement for a transaction. If you have been asked to sign a purchase agreement, you should fully understand what you agree to and what obligations you must fulfill. Before signing a contract, it is recommended that you have it reviewed by your attorney.
A contract lawyer can review your purchase agreement's terms and ensure that it is a fair and legally enforceable contract. Your lawyer will be able to explain the contract to you so you are fully aware of all your obligations.
Purchase Agreement Drafting Cost
You will incur legal fees if you hire a lawyer to draft a purchase agreement. In addition, a lawyer will charge for the time it takes to draft the contract in may include additional fees for consultations and communication.
ContractsCounsel’s marketplace data shows that the average purchase agreement drafting costs $840.00 across all states and industries.
Purchase Agreement Review Cost
If you choose to draft your purchase agreement or must sign a purchase agreement that has been provided, you can hire a lawyer to review the contract. A lawyer will charge for their time reviewing the agreement, but the fees are typically less than drafting fees.
ContractsCounsel’s marketplace data shows that the average purchase agreement review costs $690.00 across all states and industries.
How Do Lawyers Charge for Purchase Agreements?
Hourly Rates for Purchase Agreements
Hourly rate fee structures are a common way for lawyers to bill clients. Under an hourly rate, the lawyer will keep track of their time working on the project and then bill the client for the total number of hours at a predetermined hourly rate.
This fee structure ensures that the lawyer is paid for their time even if the case takes longer than expected.
ContractsCounsel’s marketplace data shows that the average hourly rate for a purchase agreement lawyer ranges from $200 - $350 per hour.
Flat Fee Rates for Purchase Agreements
Flat fee rate structures are becoming more common for lawyers when hired for a specific project, like drafting or reviewing purchase agreements.
Under this fee structure, the lawyer will provide their client with a flat fee quote for legal services. The client is typically required to pay this fee upfront and usually will not incur any additional fees.
ContractsCounsel’s marketplace data shows that the average flat fee rate for a purchase agreement is $760.00.
Get Help with Purchase Agreements
Do you need help with a purchase agreement project? If so, post a project in ContractsCounsel’s marketplace to receive flat fee bids from contract lawyers to handle your project. All lawyers on the ContractsCounsel’s platform are vetted by our team to make sure you are provided with top tier service.