Title: The Laws Governing Real Estate Contracts – GetLegal
Headings: Real Estate Contracts
Real Estate Contracts
The Laws Governing Real Estate Contracts
Real Estate Contracts—The Basics
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Content: Because of the exclusive nature of the relationship, a broker or agent may be entitled to a commission even when a buyer or seller completes a transaction without the broker or agent’s assistance. Typically, the purchaser of real property initiates the negotiation, submitting an offer to buy the real estate according to specific terms. The seller may accept the offer (in which case, a contract has been formed), or may propose new terms in the form of a counteroffer. The purchase or sale of land is governed by the statute of frauds, which means that such contracts will only be enforceable if they are in writing. State laws typically specify what provisions must appear in a real estate contract. Though the parties may draft an agreement from scratch, form contracts are typically available through realtor’s professional organizations. As a general rule, real estate contracts tend to carry a number of conditions—requirements that must be met before the contract will be enforceable in a court of law. These typically include the requirement of a number of inspections, a survey, a policy of title insurance, and approval of financing. A purchase may also be conditioned on the sale of other property. The Fair Housing Act prohibits discrimination in real estate transactions on account of race, color, religion, sex or national origin.