Washington Vacant Land Purchase and Sale Agreement Explained

Why use the Washington state vacant land purchase and sale agreement?

This contract form was developed by the Northwest Multiple Listing Service for use by realtors in Washington state. These agreements are carefully crafted to cover the needs of a wide range of situations. They're also fair, balanced agreements that provide important protections for both the buyer and seller. Also, this real estate contract is widely used in the real estate industry,

Where to find the Washington state purchase and sale agreement form

This contract form was developed by the Northwest Multiple Listing Service for use by realtors in Washington state. Unfortunately, this contract template is not available to the public. However, if you're selling 'for sale by owner', you may still be able to obtain it. If you're using a title company, someone at your title company may have access to the forms. You can also find online vendors selling fillable pdf versions of the vacant land purchase and sale agreement form 25. Be sure to check the version date of any template you purchase online. Sometimes these online vendors sell versions of documents that are more than 10 years old.

Filling out and completing the Washington state form 25 for vacant land

Page one starts with several key definitions that will be referenced throughout the agreement.

1. Date and Offer Expiration Date: The dates the offer is made and when it expires. The offer will expire at 9 pm of the Offer Expiration Date, unless it falls on a weekend or holiday.
2. Buyer: Identifies the Buyer or Buyers and their status i.e. single or married.
3. Seller: Identifies the Seller or Sellers.
4. Property: Identifies the Property to be sold as Tax Parcel number and/or an address. If a legal description is required, it can be attached as an exhibit.
5. Purchase Price: The price to be paid, normally shown in both numbers and written out.
6. Earnest Money: The Earnest Money amount, how it will be paid, and who will hold the deposit.
7. Default: If the Buyer defaults, is the only consequence giving up the Earnest Money or does the Seller have additional recourse.‍
8. Title Insurance Company: The company that will provide title insurance to the Buyer.
9. Closing Agent: The company that will conduct the real estate settlement.‍
10. Closing Date: When the Purchase Price will be paid and title transferred to Buyer. If possession will not occur at closing, another date can be specified.‍
11. Services of Closing Agent for Payment of Utilities: Whether or not the Closing Agent is responsible for ‍
12. Charges/Assessments Levied Before but Due After Closing: Determines who pays for any special assessments levied before closing, but not due until after closing.‍
13. Seller Citizenship (FIRPTA): This determines if taxes may be withheld from the Seller’s proceeds at closing.‍
14. Subdivision: Only applies if the property to be sold doesn’t exist yet and is subject to a subdivision.‍
15. Feasibility Contingency Expiration Date: The Buyer’s due diligence period.‍
16. Agency Disclosure: Who the brokers represent.‍
17. Addenda: Any additional documents being attached to the contract. For vacant land, common addenda would be forms 22LA (Land/Acreage) and 35F (Feasibility).

On page two of the contract the real terms and conditions begin.

• Purchase Price: The Buyer will pay the Seller the Earnest Money, which is part of the Purchase Price. The Buyer will also pay the remaining balance of the Purchase Price to the Seller at Closing. 
• Earnest Money: The Buyer will pay the Seller the Earnest Money within two days of the Binding Agreement Date. The Earnest Money will be held in an escrow account.
• Condition of Title: The Seller must have a good, clear title to the property, meaning they own it and can sell it. Monetary encumbrances such as loans or property tax liens will be paid by Seller on or before Closing. Title will be conveyed by a Statutory Warranty Deed.
• Title Insurance: Seller to pay for title insurance on behalf of the Buyer.

• Closing and Possession: Closing will be held on the Closing Date specified in Specific Term No. 10 of the contract, unless that date falls on a weekend or holiday. Seller to maintain the Property in its present condition until Buyer has possession. Seller will not enter into or modify leases without Buyer’s consent.
• Section 1031 Like-Kind Exchange: A 1031 exchange is a way for someone selling a property to defer paying capital gains taxes by reinvesting in a similar property within a specific time frame. This paragraph calls for the Buyer and Seller to cooperate with the party seeking the 1031 exchange.
• Closing Costs and Prorations and Charges and Assessments: Seller and Buyer to pay ½ of the escrow fee each. Property taxes and HOA dues will be prorated based on the Closing Date. 
• Sale Information: The Buyer’s and Seller’s brokers are authorized to report this agreement to anyone related to the sale.
• Seller Citizenship and FIRPTA: This part is about a law that says if the Seller isn't a U.S. citizen, the government might withhold some money out of the sale price for taxes.
• Notices and Delivery of Documents: This part talks about how the Buyer and Seller have to communicate with each other about the contract. It says any important messages have to be in writing.

• Computation of Time: Time periods mentioned in the contract start the next day and continue until 9 pm on the last day of the period. For example, the Earnest Money is due two days after the contract is fully signed. So, if the contract is signed on Monday, the Earnest Money would be due by Wednesday.
• Integration and Electronic Signatures: The contract represents the entire agreement between the parties. There are no other agreed terms not written in the contract. Also, electronic signatures have the same legal effect as handwritten ones.
• Assignment: The Buyer can't substitute someone else in the contract without the Seller's permission.
• Default: This clause specifies what happens if the Buyer doesn't follow through with the purchase. Depending on what was selected on Specific Term No. 7 of the contract, the Seller may be entitled to the Earnest Money or exercise legal rights to enforce the contract or sue for damages.
• Professional Advice and Attorney’s Fees: In the event of a lawsuit, whoever wins is entitled to collect reasonable attorney’s fees.
• Offer: The offer must be accepted by 9 pm on the Offer Expiration Date specified in Specific Term No. 1 of the contract, otherwise it becomes invalid.
• Counteroffer: If a counteroffer is made, the party receiving the counteroffer has until 9 pm of the counteroffer expiration date to accept.
• Offer and Counteroffer Expiration Date: Unless otherwise specified, the offer/counteroffer expires 2 days after it’s delivered.
• Agency Disclosure: This clause is about the real estate agents involved in the sale. It explains who they work for and what their roles are.
• Commission: This part talks about how the real estate agents will get paid. It says the Buyer and Seller have to pay them a commission, which is a percentage of the sale price.

• Feasibility Contingency: This part gives the Buyer a chance to check if they can use the property the way they want to. For example, they might want to build something on it. If they find out they can't, they can back out of the deal.
• Subdivision: This part is only relevant if the property is being divided into smaller lots. It says the sale depends on the final approval of the subdivision plan.
• Information Verification Period: This part gives the Buyer a chance to check if the information they got about the property is correct. If it's not, they can back out of the deal.
• Property Condition Disclaimer: This part says that the real estate agents aren't responsible for the information about the property. It's the Buyer's responsibility to perform due diligence.

That's it for the main body of the vacant land purchase and sale agreement! Depending on your situation, you may still need to fill out and attach additional addenda or disclosures to complete the contract package.

Conclusion

That concludes the overview of the Washington state vacant land purchase agreement. To recap, this contract is a simple and fair agreement to use when selling vacant land. Most of the contract language can be distilled into easy to understand concepts. When selling vacant land in Washington, the form 25 vacant land purchase and sale agreement is a good option to get you one step closer to selling your property.

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This article is for informational purposes, and is not tax or legal advice. Northwest Multiple Listing Service contract forms are intended for use primarily by licensed real estate brokers or sales agents who are trained in their correct use.