What is the difference between an Offer to Buy Real Estate and a Real Estate Contract?
March 1, 2020
It is important to note that an Offer to Buy Real Estate and a Real Estate Contract are not the same thing.
An Offer to Buy Real Estate or a Purchase Agreement are contracts between a buyer and a seller agreeing that a sale of real estate will take place in the future between the parties. It usually includes the purchase price, the description of the real estate to be sold, the identities of the parties, the date when the sale will be closed, and when possession of the real estate is to be transferred to the buyer. In most Jurisdictions, an Offer to Buy Real Estate or a Purchase Agreement is not the actual conveyance or transfer of title.
A Real Estate Contract is an agreement to transfer the title to real estate to a person, at some specified time in the future, contingent upon that person completing all payments for the real estate at the set purchase price. The Real Estate Contract contemplates and outlines the execution of a deed in the future. The seller is known as a vendor and the buyer is known as a vendee. The vendor gives a deed to the vendee once the vendee has performed their obligations under the contract. Until such time, the vendor retains title to the real estate.