In real estate acquisitions, a buyer may provide the seller a written agreement that details the terms and conditions under which the sale will occur. This type of written agreement is called an agreement or contract of sale. Also known as a purchase agreement or contract of purchase, an agreement of sale can be considered a binding contract between a buyer and seller regarding any kind of property, but more commonly involving real estate property.
An agreement of sale is evidence of a buyer agreeing to the price and terms provided by the seller and the seller agreeing to the mode of payment and other conditions provided by the buyer. There are different formats for an agreement of sale, but the general format includes the names of the parties involved, the buyer and seller, as well as the contact information of all parties. Aside from the basic identification and contact information, the agreement of sale also includes the terms and conditions stipulated by both buyer and seller, the purchasing price, the terms of delivery, and the mode of payment. The document also provides details regarding the state of the goods or services to be purchased. Such details may include any damage that has already been suffered by the goods or the condition of the house, etc. The rest of the content of an agreement of sale depends on the jurisdiction where it is to be implemented.
Before entering into an agreement of sale, it is necessary to ascertain if it is a binding contract or a promise of purchase within the jurisdiction it is to be implemented in.