The chances are at some point you will need to sign a contract for something. Whether it’s an agreement for a loan or your multi million pound transfer to Real Madrid you need to know what you are signing. So to help you, here are five things to consider before signing any contract.
1) Who are the parties involved?
This goes for both you and the other party involved in the contract. Ideally you should have both done your research and looked into what you are signing up for – for example, if you are buying a business then you should check if they are financial stable because if not, you may get saddled with their debt (sounds obvious but even the most experienced of professionals have come unstuck with this!)
2) What is the contract for?
Initially you may think “Well this is obvious – I’m signing a tenancy agreement/loan etc”. But a contract is about more than just the items involved.
For example, let’s say you have a new job – your job is cleaning cars. However, the contract may cover when you start work, the amount of cars you have to clean within a given time frame or may specify what products you can and can’t use.
This is something you need to be aware of before signing!
3) Are there any hidden clauses?
People often get caught out by the “small print”. A good example of this is with warranties. Essentially, a warranty only covers manufacturing faults so you need to be able to prove this. Companies will often offer a replacement service up to a certain time (such as 28 days) but after this you may incur repair charges.
It can’t be emphasised enough – if you’re not sure, don’t assume, ask!
4) Am I talking to the right person?
While this may have been covered a bit earlier this is more making sure you are dealing with the right people – you have to be certain they have the legal authority to offer what they say they can offer.
Equally, it is the responsibility of another party to check suitability – for example people under the age of 16 or people with a history of mental health issues may not be eligible to sign certain contracts.
5) Have I checked this properly?
The fact is we have probably signed something at some point without fully understanding the range of terms and conditions (this is further complicated with online platforms such as social media where you may not have time to check all the details).
Often the terms and conditions may not be clear or worded in such a way that they can feel a bit misleading. This isn’t always intentional – it could just be how the contract was written. However, it does mean that if something doesn’t make sense you need to check before you can sign it (the chances are if something is vague there is room for misinterpretation!)
With something big like buying a company or a credit agreement you should get some form of advice before you consider putting pen to paper. If you are uncertain about whether a deal is right or not we recommend contacting us so we can offer further advice to help you make the right decision!