Does the purchase price of property include the total cost of the property if a gift of equity is occurring?

UPDATED: Oct 1, 2022

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Does the purchase price of property include the total cost of the property if a gift of equity is occurring?

Purchase and Sale Agreement in contract states that the purchase price of
property to be paid by buyer is the estimated total price for the property. We are
buying the property from my in-laws. They agreed to give us a gift of equity.
They agreed to sell us the property for 190,000. So would this part of the
contract state that we are paying 190,000 or would it state the total? There is
an Exhibit A stating that they will gift an amount of equity. But that is all that is
stated in the contract. Thank you

Asked on October 6, 2018 under Real Estate Law, Georgia


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 4 years ago | Contributor

The purchase price is what the buyer actually pays for the property. Purchase price is separate and distinct from value: value can be lower or higher than what you purchase the property for. If being sold to you for $190k, purchase price is $190k.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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