Real Estate · Contracts

Which of the following is NOT required for a valid real estate contract?

Correct answer

A witnessed signature in front of a notary

  1. A Consideration
  2. B Legal purpose
  3. C A witnessed signature in front of a notary
  4. D Offer and acceptance (mutual assent)

Why this is the answer

A valid real estate contract requires: (1) offer and acceptance (mutual assent or 'meeting of the minds'); (2) consideration (something of value exchanged, even if symbolic); (3) legal purpose (the contract cannot require an illegal act); (4) competent parties (legally capable of contracting); and (5) in most cases, the writing requirement of the Statute of Frauds (real estate contracts must generally be in writing to be enforceable). A notarized or witnessed signature is not generally required for the contract itself, though some states require it for the deed transferring title. Verbal real estate contracts can be valid in principle but are nearly impossible to enforce because the Statute of Frauds requires writing.
Source: Real Estate Principles, Contract Validity

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About this topic: Contracts

Offer, acceptance, consideration, legal purpose, capacity, and the Statute of Frauds (writing requirement) are the essentials of a valid real estate contract. This is one of 10 Salesperson (National) questions on contracts, each with a full explanation on a single study page.

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