Wisconsin Real Estate Contract: Different Types and Key Terms to Include

What is a Wisconsin Real Estate Contract?

A Wisconsin real estate contract, or a Wisconsin residential purchase and sale agreement, is a document that is drafted when a buyer when makes an offer on real property that is for sale. If the seller of the property accepts the offer, the terms of the real estate contract will be negotiated and the property buying process can begin.

Once both parties sign the real estate contract, they are considered “under contract” and the agreement is legally binding and enforceable. It is customary for the buyer to make an earnest money deposit on the property and the seller cannot legally accept any additional offers.

If either party breaches the contract, the non-breaching party can take legal action to recover any losses or damages caused by the breach.

Common Wisconsin Real Estate Contracts

There are several types of real estate contracts that are used in Wisconsin. The type of contract will vary based on the type of property in question.

• Standard purchase agreement. This is the most common type of real estate contract because it is used in residential property transactions. Real estate agents will use a contract template form like the WB-11 which is approved by the Wisconsin Real Estate Examining Board.
• Condominium purchase agreement. This contract is used specifically when buying or purchasing condominiums. Form WB-14 is also approved by the Wisconsin Real Estate Examining Board.

It is essential that parties entering into a real estate contract use the correct contract form. Any mistakes on these forms could lead to a significant financial loss. If either party has trouble understanding the contract terms, they should reach out to a licensed realtor or real estate attorney for help.

4 Essential Elements of a Wisconsin Real Estate Contract

According to Wisconsin state statutes, all real estate contracts must include four essential elements:

1. A valid offer from the buyer
2. Acceptance of the offer by the seller
3. Consideration
4. Mutual assent or the agreement between the parties to enter the agreement

What Must Be Included in a Wisconsin Real Estate Contract?

The purpose of a real estate contract is to protect both parties during the home buying process. For this reason, the contract will lay out terms and conditions that the buyer and the seller must abide by to finalize the sale.

All real estate contracts should include the following clauses:

• Party information. The names and addresses of the buyer and the seller. The contract should also include any agents, brokers, or attorneys who assisted with the sale.
• Property description. The legal property description and property address.
• Purchase price. The agreed upon sale price that the buyer will give the seller in exchange for the property title.
• Contingencies. Conditions that must be met before the sale can be completed. Common contingencies include the buyer securing financing and home insurance, the house passing inspection, and the buyer selling their current home. If contingencies are not met, the parties may have a legal reason and right to terminate the contract.
• Disclosures. Before the sale is finalized, Wisconsin laws require the seller to disclose material facts about the condition of the property in a Real Estate Condition Report. In Wisconsin, disclosures are due 10 days after accepting the buyer’s offer.
• Closing date. The date that the sale will be completed. The seller will receive payment and the and the property will be transferred to the buyer.

A comprehensive and detailed real estate contract is essential to a smooth home buying process. If the contract is missing information or fails to include required clauses, it could be deemed void and unenforceable.