September 19, 2019 | Home Buying
If you are buying a Lennar home, learn the details surrounding the Purchase Agreement.
After shopping the market, you find your dream home and move to purchase. Your intent to purchase and the terms and conditions upon which you (and the seller) agree to complete this transaction are documented in a contract known as the Purchase Agreement. When you purchase a new home from Lennar, we want you to meet our Agreement with little-to-no reservation, and in fact possess a better understanding of its components and be aware of the steps our New Home Consultant (NHC) will walk through with you the day you sign. After reading this article, if you have any questions about the Purchase Agreement or anything that has been noted here, please visit one of our new home communities where you can speak with an NHC to get answers.
What do I bring with me to sign the Purchase Agreement?
When you arrive at the Welcome Home Center (WHC) to sign your Purchase Agreement, you will need your driver’s license, passport, or other government-issued photo ID. If you are a co-purchaser of the new home, or you have a spouse that is or is not putting up financial resources for this property, any and all individuals who share co-ownership must bring an acceptable photo ID to the signing of the Agreement as well. Please note: you cannot bring the IDs for these co-owners; they must be present at the signing to put their own unique signature on the contract.
As a sign of good faith that you intend to buy a new home, you must bring earnest money in the form of a personal check, cashier’s check, or money order to the signing of the Agreement. Earnest money is a deposit made to Lennar, and the amount varies by community.
What are the (basic) components of the Purchase Agreement?
A Lennar new home Purchase Agreement is typically 70+ pages long, and when you initially browse it over, it can be overwhelming with its vast legal jargon, but in actuality, this contract is designed to protect you and the seller by clearly defining all expectations of the sale and purchase of a new home. Your NHC will review the Agreement with you and advise you to seek competent legal advice before signing if you do not understand one or more parts of the contract. To circumvent this delay, you can request the NHC send you the blank Agreement in advance, so you may seek legal counsel before the day you sign. Here, we can give a soft overview of some of the components of your Agreement.
Buyer Information – You and your spouse or, if there is no marital partner but there is a co-purchaser of the property – ideally, all parties that have a stake in the new property, must provide their contact information. Please note: the email address of the primary contact should be the same address used to log into your myLennar account or that account associated with your new home purchase.
What is myLennar? myLennar is a free, online account that helps you navigate your journey to homeownership. It evolves with you as you shop, buy, and own your new home, allowing you to save floorplans, receive construction updates, access new home documents, and more. Please note: if you sign the Purchase Agreement prior to creating your myLennar account, our system automatically creates one for you, using the email of the primary contact as the username. The owner of this email will receive a message in their inbox with a temporary password to their new myLennar account.
Purchase Price and Payments – This section shows a simple breakdown of the total purchase price for your new home. It begins with the base price plus the homesite premium (if applicable) and any feature options, upgrades, or extras. If you opt out of any add-ons, these and other discretionary reductions are deducted, and you are left with the total purchase price. Please note: if during construction you decide to make a change, whether that is the installation, replacement, or removal of a feature, and that change is approved, there may be a change fee.
Below the purchase price, there is a breakdown of those payments you are responsible for, beginning with the initial deposit (or earnest money). You can ask your NHC to expand on the “upgrade deposit,” “additional deposit,” and “advanced deposit.” At the end of your Payments list, you will see your closing costs which you pay at closing.
Financing (and Broker) Information – Here, you will identify the loan type you have applied for, as well as the mortgage group with which you applied. If you have a real estate broker, you must fill out their information below the mortgage group. To clarify, a real estate agent and real estate broker perform similar functions, and both have the same hired purpose of helping you find and buy a new home; however, a broker has more degrees and certifications that permit them to work independent of a firm, or they can run their own firm, while an agent operates under the supervision of a broker.
What else? The remainder of the contract comprises the actual “Purchase and Sale Agreement” between you and Lennar. This is a detailed listing of all those stipulations and exceptions to the Agreement, followed by several addendums for items such as insulation, building materials, and Lennar home automation. Please note: the wording in the Agreement cannot be altered, and your NHC can explain this further. If necessary, your NHC can make future changes, like the input of names, prices, and loan types, for limited cases like the switching of a loan or the addition or removal of buyers. Ask your NHC to identify additional cases for acceptable updates to your contract.
Beyond its stipulations, exceptions, and addendums, the Purchase Agreement has affiliated business disclosures for Lennar’s subsidiary members in mortgage, title, and insurance services. There is also a master disclosure for the purchase of this new home in the named Community and Neighborhood. If you have any questions, again please do not hesitate to ask your NHC, who can summarize the high points of the contract, but will advise you to seek legal counsel for a full understanding of what you are agreeing to when you sign.
What should I expect when I go to sign the Purchase Agreement?
You and your co-buyer(s) will go to the WHC to go over the contract with your NHC, who can answer your immediate questions but will still advise you to seek legal counsel if there is any confusion about the constituents of the Agreement. Under special circumstances, like a buyer is living in another state and cannot afford to fly down for this step, the NHC will email the contract via DocuSign. Once the buyer has had enough time to review and confirms their desire to move forward, the NHC will send another email with a temporary link to DocuSign the contract. In these cases, the buyer will wire their earnest money.
Beyond the NHC, yourself, and any co-buyers, no additional parties should be present at the signing. Your real estate agent or broker may accompany you, but their presence is not mandatory, and a copy of your signed Agreement will be sent to them via email for their records. To ensure you walk away with a clear understanding of the Agreement, we encourage you to pick a day and time that best coordinates with your schedule, and you may want to enlist family or trusted friends to watch your children and/or pets.
Prior to this day, you will have made one important decision regarding your new home purchase. You will have chosen to buy either a move-in ready home or a to-be-built home (i.e., you choose a homesite, and Lennar builds your new home from the ground up). A move-in ready home is preferable for buyers who want to skip lengthy construction and enjoy a facilitated moving process that works with their timeline. If you choose a to-be-built home, the projected timeline for the start and completion of your construction will be a separate point of discussion with your NHC.
While going over the Agreement, your NHC should give you additional handouts on items concerning your new Lennar home. There is the Price List, which explains the fluctuating cost of a new home based on the selected floorplan, number of stories, square footage, homesite premium, and elevation. You will receive a copy of the marketing floorplan you chose – this is not an actual blueprint of construction drawing. To show how much value you get with your new Lennar home, you will be provided an Everything’s Included® feature checklist1, and if you bought a Connected Home by Lennar (i.e., a new home engineered with no dead spots), you will get a sheet that identifies those smart home devices installed during construction and delivered after completion.2 The Limited Warranty packets will disclose the details tied to Lennar’s limited one-year warranty on workmanship, limited two-year warranty on systems, and limited 10-year warranty on structural elements.3 Finally, your NHC will give you a packet with those covenants, conditions, and restrictions (CC&Rs) established by the homeowners association (HOA). To learn more about HOA fees, ask your NHC.
We hope this article has given you better insight into the components of the Purchase Agreement and the expectations associated with signing this contract. Please note: the Purchase Agreement for a new Lennar home, or a new home from one of our subsidiary builders (i.e., Village Builders, CalAtlantic Homes, or WCI Communities), may differ in its language between our divisions (or markets). For this reason, we once more encourage you to verify with your NHC in your community of interest the exact details and process circulating the Purchase Agreement for a new home in their location.
1Please see your New Home Consultant and/or home purchase agreement for actual features designated as an Everything’s Included feature.
2Lennar’s automated homes are built according to the Wi-Fi Alliance® program guidelines for Wi-Fi CERTIFIED™ Home Designs. See the Wi-Fi Alliance® website at www.wi-fi.org for additional information regarding the Wi-Fi CERTIFIED™ Home Design program. The Wi-Fi Alliance® also certifies home designs after review of a home floorplan, which may occur after your closing. Wireless performance in homes will vary due to design changes, construction changes, placement of furnishings and appliances, usage, and local conditions. Network performance will be affected by network configuration, the number of users, and the type of use. Homeowners are responsible for providing their own Internet connection and determining their own bandwidth needs, which may vary. Lennar does not guarantee that networks, equipment, or services will meet all homeowner needs. Homeowners are also responsible for configuring all security features. Lennar does not warrant or represent that any network or network device is secure or can prevent all privacy intrusions, malware, or cyber-attacks, even when correctly configured. Certain products or services are provided by third parties, and not Lennar. Lennar does not guarantee any equipment or services provided by third parties.
3Lennar Limited Warranty (“Limited Warranty”) consists of: (a) a limited 1-year warranty on workmanship, (b) a limited 2-year warranty on systems, and (c) a limited 10-year warranty on structural elements. Exclusions apply. Proper maintenance of your Home is vital; failure to perform regular required maintenance can limit your Limited Warranty rights. Claims must be submitted as soon as possible and in no event later than the expiration date of the applicable limited warranty. Lennar has no obligation with respect to claims submitted more than 30 days after the expiration of the applicable limited warranty. Homeowner must provide Lennar with prompt and complete access to inspect and investigate claims and make repairs, and cooperate fully in the investigation of any claim. Failure to provide access to the home shall void the Limited Warranty with respect to that claim. Lennar reserves the sole right to determine the repairs and/or replacements necessary to meet the standards of the Limited Warranty, and reserves the option to repair, replace or pay homeowner the reasonable cost of repair/replacement for any warranted and covered claim. Disputes are subject to mediation and binding arbitration. State law may affect the terms of the Limited Warranty. See a New Home Consultant for details or to obtain a copy of the Limited Warranty.
This is not an offer in states where prior registration is required. Void where prohibited by law. Copyright © 2019 Lennar Corporation. Lennar, the Lennar logo, Everything’s Included, and the Everything’s Included logo are U.S. registered service marks or service marks of Lennar Corporation and/or its subsidiaries. Date 09/19