What is a purchase contract in real estate?
A purchase contract (also known as a contract to purchase real estate) is a legal written agreement between a buyer and seller. Purchase contracts vary state to state depending on local law. When both the buyer and seller finish negotiating terms and stipulations, they sign the purchase contract and it becomes legally binding—contingent upon the terms in the contract being met. Some states allow real estate agents to draw up purchase contracts but others only allow lawyers to write contracts.