Contracts
A bilateral contract in Missouri real estate is one in which:
AOnly one party makes a promise
BBoth parties exchange promises✓ Correct
CThe government is a party
DNo consideration is required
Explanation
A bilateral contract involves mutual promises—both parties are obligated. A purchase agreement is bilateral: the buyer promises to buy and the seller promises to sell.
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Key Terms to Know
Purchase Agreement
A legally binding contract between a buyer and seller that outlines the terms and conditions of a real estate sale.
Earnest MoneyA 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.
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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