Contracts
In Michigan, a real estate contract that lacks consideration is:
AVoidable by the party who did not receive consideration
BVoid from the outset and unenforceable✓ Correct
CEnforceable if both parties are of legal age
DValid if witnessed by a notary
Explanation
Consideration is a required element of a valid contract in Michigan. A contract without consideration is void (not merely voidable) because an essential element is missing.
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Key Terms to Know
Earnest Money
A deposit made by the buyer when submitting a purchase offer, demonstrating serious intent and serving as consideration for the contract.
ContingencyA condition in a purchase contract that must be satisfied before the sale can proceed to closing.
Purchase AgreementA legally binding contract between a buyer and seller that outlines the terms and conditions of a real estate sale.
Option ContractA contract giving the buyer the right, but not the obligation, to purchase a property at a specified price within a specified time period.
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