Some Highlights: Don’t forget to set your clocks forward this Sunday, March 8 at 2:00 AM EST in observance of Daylight Saving Time, unless you’re a resident of Arizona or Hawaii!
Are Verbal Agreements Valid Contracts
Are verbal agreements valid contracts?Below is a Q&A handled by the Texas Association of REALTORS. It's a great question that comes up often, especially in a frenzied market, such as where we are now, where real estate agents, buyers and sellers are trying to work quickly in order to secure their position in a real estate transaction.
It really doesn't matter which side of the transaction you are on, or what your role is, the answer, is to get it in writing. Fortunately, technology has advanced so much that agents, buyers and sellers can sign electronically from anywhere there is an internet connection. With the vast network of the internet and cellular service, we hardly have an excuse to not have something signed or in writing. But sometimes priorities get out of order, people get relaxed (or just lazy) and what someone *thought*, ends up not being correct. I don't think there is anything wrong with working out the details verbally, as long as everyone knows that it's verbal and won't stick until put in writing.
Question: My seller received a written offer to purchase his property. Instead of countering the offer in writing, the parties engaged in verbal negotiations that resulted in a verbal agreement on new terms. Before the buyer’s broker submitted an updated offer with those terms included, my seller received a written offer from another potential buyer that he chose to accept. Now, the first buyer is threatening to sue my client for breach of contract because of their verbal agreement. Is the verbal agreement enforceable?
Answer: No. A verbal agreement must be reduced in writing and signed by the buyer and seller to become valid. Since a contract was never created, nor signed, there is nothing for the buyer to enforce. While verbal negotiations of contracts can be a quicker way to reach an agreement, verbal agreements are not enforceable for the sale of real property.
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