A contract is created upon the acceptance of the basic terms of an agreement by both parties. This is called mutual consent. Generally, before this happens, there is a meeting between agents verbally, whether in person or on the phone. This initiation and exploration by the seller and buyer is a called an offer and acceptance.
The offer from one party to the other, if accepted, will further the buying/selling process, taking buyers and sellers to the point whereby they must execute the required conditions to close the deal. An example of a common condition in a real estate purchase is getting approved for financing so that the transaction can close.
A real estate offer exists when the person who is offering to buy, the offeror, has communicated his or her intentions to the person who is offering the deal, the offeree. The terms found in the standard real estate forms will clearly highlight every component of the deal, such as buyer/seller name, purchase price, closing date, conditions, and other specifics. If buyer or seller does not meet his or her conditions, both can be held liable. In the case of the buyer, he or she may forfeit their deposit and, in the case of the seller, he or she may be subject to a fee.
