First things first: Make certain that all the provisions in your real estate option agreement are in full compliance with all of your state's real property statutes. And whatever you do, do not operate under the false assumption that a real estate option agreement that you can download for free from a web site on the Internet is legal in your state. It most likely is not! This is because real estate contract law varies from state to state, and a real estate option agreement that is perfectly legal in Florida may include provisions that are considered unconscionable in Wisconsin. I cannot overemphasize the financial consequences that a poorly written real estate option agreement can have, especially when put under the scrutiny of a judge presiding over a lawsuit filed by a disgruntled op-tionor. For example, suppose that, after signing the option agreement, an op-tionor discovered that your real estate option agreement contained provisions that are considered to be unconscionable in your state, are illegal, and are not enforceable in a court of law. And now, the optionor has filed a lawsuit against you, the sleazy real estate investor, for damages, claiming that you took unfair advantage of him or her. However, since ignorance of the law is not considered to be a valid legal defense, you now have little choice but to try to settle out of court with the optionor before the case goes to trial. A state-by-state listing of real property statutes that are currently available online can be found at the following web site: www.law.cornell.edu/topics/state_statutes3.html#property.
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