Purchase Agreement vs. Counter Offer — a purchase agreement sets the initial terms, while a counter offer modifies them during negotiation.
Grant Deed vs. Quitclaim Deed — a grant deed includes implied warranties of title, while a quitclaim deed transfers only the seller's current interest with no guarantees.
Property Disclosure vs. Home Inspection Report — a disclosure reflects what the seller knows, while an inspection report reflects what a licensed inspector independently finds.
Earnest Money Receipt vs. Closing Statement — an earnest money receipt records the deposit upfront, while a closing statement reconciles all funds at the end of the transaction.
Listing Agreement vs. Purchase Agreement — a listing agreement is between seller and agent to market the property, while a purchase agreement is between seller and buyer to complete the sale.
Contingency Addendum vs. Amendment — a contingency addendum sets conditions that must be met for the sale to proceed, while an amendment changes terms already agreed upon.
Purchase Agreement — sets the price, terms, and conditions for buying or selling a home.
Property Disclosure Statement — informs the buyer of known defects and material facts about the property.
Deed Transfer Form — legally conveys ownership of the property from seller to buyer.
Earnest Money Receipt — confirms the buyer's good-faith deposit and its terms of release.
Lead-Based Paint Disclosure — required for homes built before 1978, notifying buyers of potential hazards.
Home Inspection Contingency Addendum — allows the buyer to request repairs or exit the deal based on inspection results.
Closing Statement — itemizes all costs, credits, and final financial figures at settlement.
FAQs
At minimum, sellers need a purchase agreement, a Transfer Disclosure Statement, and a Natural Hazard Disclosure report. Depending on the property, additional forms such as a Lead-Based Paint Disclosure or HOA documents may also be required.
California does not require an attorney to close a residential real estate transaction. Most sales are handled through escrow companies and real estate agents, though buyers and sellers may choose to involve an attorney for added peace of mind.
Earnest money is a deposit made by the buyer to show serious intent to purchase. In California, it is typically refundable if the buyer cancels during an active contingency period, but may be forfeited if the buyer backs out after contingencies are removed.
FSBO stands for For Sale By Owner, meaning the seller markets and sells without a real estate agent. All state-mandated disclosures still apply to FSBO sales in California, including the TDS and NHD report.
Title is transferred by recording a deed — most commonly a grant deed — with the county recorder's office. This step typically happens on the closing date, once escrow confirms that all funds and conditions have been satisfied.
Key legal points
California sellers are legally required to complete a Transfer Disclosure Statement (TDS) for most residential sales.
The Natural Hazard Disclosure (NHD) report is mandatory and must be delivered to the buyer before closing.
Homes built before 1978 require a federal Lead-Based Paint Disclosure regardless of state rules.
Earnest money deposits in California are typically held in escrow and governed by the terms of the purchase agreement.
California is an escrow state, meaning a neutral third party handles funds and documents throughout the transaction.
Buyers generally have a contractual right to a physical inspection period before the sale becomes binding.
Title insurance is standard practice in California and protects both buyers and lenders against ownership disputes.
A grant deed is the most commonly used deed form for residential property transfers in California.
FSBO (For Sale By Owner) sellers are still required to provide all legally mandated disclosures, the same as agent-represented sellers.
How to get started
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Practical tip
In California, the escrow period typically runs 30 to 45 days, so having all required disclosure forms ready before listing can help prevent last-minute delays.
Glossary
Purchase AgreementThe binding contract between buyer and seller that sets the price and terms of the sale.
EscrowA neutral third-party arrangement that holds funds and documents until all closing conditions are met.
Transfer Disclosure Statement (TDS)A California-required form in which the seller discloses known property defects and conditions.
Natural Hazard Disclosure (NHD)A report identifying whether the property lies in a flood, fire, earthquake, or other hazard zone.
Grant DeedA deed that transfers property ownership and includes implied warranties that the seller holds clear title.
Quitclaim DeedA deed that transfers only whatever interest the seller currently holds, with no title guarantees.
Earnest MoneyA good-faith deposit from the buyer, held in escrow and applied toward the purchase price at closing.
ContingencyA condition in the purchase agreement that must be satisfied before the sale can proceed.
Title InsuranceA policy protecting the buyer or lender against losses from title defects or ownership disputes.
Closing StatementA document itemizing all financial transactions between buyer and seller at the close of escrow.
FSBO (For Sale By Owner)A sale in which the seller handles the transaction without a licensed real estate agent.
AddendumA separate document attached to the purchase agreement that modifies or adds specific terms.
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