Real Estate Contract Flashcards
Bilateral Contract
Promise for a promise. Two-sided contract, binding upon both parties
Contract
Legally enforceable agreement between competent parties who agree to perform or refrain from performing certain acts for a consideration
Electronic Transaction
Online transaction, through email or website. Includes electronic signatures
Executed Contract
Completed contract. All terms and conditions fulfilled
Executory Contract
Some action needed. Contract not yet finished
Express Contract
An oral or written contract in which the parties state the contract’s terms and express their intentions in words
Implied Contract
Created by actions. Agreement of parties through acts or conduct
Letter of Intent
A document used to summarize terms that would be acceptable to parties. It is a preliminary document that can be created before the actual purchase contract is written, and is not binding
Meeting of the Minds (mutual assent)
A complete understanding between the interested parties
Offer
A proposal to make a contract
Offeree
A person to whom an offer is made. Receiver of offer
Offeror
A person who makes an offer. Giver of offer
Risk of Loss
A provision in a contract related to potential damage to the property before close of escrow
Unilateral Contract
Promise for an act. One-sided contract. Promise made for second party to perform
Consideration
The inducement to contract; is something is value, such as money property. Consideration makes a contract enforceable
Earnest Money
Money paid to confirm a contract
Enforcable
A valid contract, with all of the essential elements present, that is binding on all parties and can be enforced through a court of law
Lawful Purpose
One of the four elements for a valid contract
Parol Evidence Rule
In court of law, a contract must stand on the written word; no oral explanation is acceptable, except to clarify a written ambiguity
Statute of Frauds
A state law that provides that certain contracts must be in writing in order to be enforceable in the courts; established in England in 1677 and adopted in full or in part by all 50 states
Unenforceable
Contract that is void and not enforceable in court of law. Barred by statute of limitation or the doctrine of laches
Valid
A contract is valid if it will contain all essential elements; legal, enforceable, and binding on all parties
Void
To have no force or effect, does not exist
Voidable
A contract that seems valid and encforceable, but may be voided by one of the parties
