Land Transaction Service Agreement

What a good one includes

• Explicitly detail the specific tasks being performed, such as zoning research, surveyor coordination, or buyer representation, to prevent scope creep.
• Clearly outline how and when compensation is earned, whether through a flat consulting fee, hourly rate, or a percentage-based commission upon closing.
• Specify which party covers out-of-pocket costs for third-party reports, soil testing, environmental assessments, and municipal filing fees.
• Include a robust clause stating that the specialist is not a licensed surveyor, environmental engineer, or tax attorney, and that the client must independently verify technical data.
• Define the contract's effective period and the specific conditions or notice requirements under which either party can terminate the agreement.
• Establish a clear protocol, such as mediation or binding arbitration in a specific jurisdiction, to resolve any contractual disagreements quickly and quietly.

Common mistakes to avoid

• Relying on a simple street address instead of the official legal description or tax map parcel number, which can lead to boundary disputes.
• Guaranteeing that a parcel will successfully obtain specific zoning changes or building permits, rather than promising to perform the coordination services diligently.
• Neglecting to define exactly when a consulting or brokerage fee is deemed earned, such as upon presenting a willing buyer versus at the actual transfer of deed.
• Forgetting to clarify if and how the coordinator can represent both the buyer and seller in the transaction, which may violate state licensing laws.

Frequently asked questions