The Term “Real Estate Contract” Explained

The Term “Real Estate Contract” Explained

The days of a handshake signifying a contract are long gone. Maybe back in the old western days you could trade a herd of cows for a house and shake on it, but these days you might get a funny look and a lot of laughs if you tried that.

No, these days there are a few more steps to creating a contractually binding agreement. There are  more signatures and more paperwork.

Of course you want a little more than just a handshake or verbal agreement to make something as big as a Real Estate Transaction come to fruition.  Therefore, you’ll need a Real Estate Contract.

If you’re in the market to buy a house there are a few things you will want to do:

  1. Get a Prequal Letter.
    This will show a seller that you are serious and have the finances to back up your offer.
  2. Find a Real Estate Agent.
    Your agent will take care of the paperwork and will communicate with the Listing Agent on your behalf.
  3. Be prepared for a bidding war.
    In today’s market, Northwest Arkansas homes sell fast. Talk with your agent to make sure you are offering terms that could be accepted by the Seller.

Now that you’ve taken care of steps 1-3, let’s imagine what would happen next.

Best case scenario you’ve got your ducks in a row and made an official offer. This means that you have spoken to your agent about what you want to offer and what you are willing to do in order to have your offer accepted by a Seller. Your agent has now written this in an official document (THE REAL ESTATE CONTRACT) and you have signed it.

Your agent submits it to the Listing Agent and the sellers accept your offer!  To officially accept your offer the sellers sign the Real Estate Contract indicating that they accept the terms you offered them in the document. At this point you have a house “under contract” and the Real Estate Contract is a legally binding document.

Moving forward from here there are many moving parts.  A good Real Estate Agent or Broker will walk you through each step, guiding you through the process.  I’d love to walk you through the real estate process.  When you’re ready to buy or sell real estate in Northwest Arkansas give me a call at  479.799.3023

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