Ranch brokers in Texas are required to use contracts formulated by the Texas Real Estate Commission. The Farm and Ranch contract runs to 11 pages and with addendums and exhibits, can grow to 20 pages. Even at that, not every aspect of the land is addressed leaving a lot of questions. And, while calling in a real estate attorney is always a great idea, you’re usually well into negotiations before the attorneys get involved. That is why ranch buyers should always have their own broker, their own representative to guide them thru the myriad points of the contract and catch “deal-breakers” before you sign your name.
In a recent negotiation, the Seller wanted to reserve his owned oil and gas minerals. All well and good, there is an addendum for that. But what about the “surface” minerals; coal, uranium, caliche, gravel, etc.? There is no form for that and no form for wind or water rights, either, and we know how important those are today. If the Buyer has an experienced agent representing him, these finer details which can be very important down the line, will be addressed.
And the land itself, can you just buy a tract of land and hope it will do what you want it to? You’ve always wanted a nice fishing pond and that’s a big part of why you’re buying this ranch. Do the soils lend themselves to a pond? Can the Buyer access the land for soil testing? Could you supplement the pond with well water legally? These issues and many more should be addressed in the negotiation process and set down in writing in the contract. Once closed, the purchase is final and not the time to be asking these questions. Be smart, get your own agent when buying a ranch.
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