What makes a contract a contract? Is it the legal prose, the professional typesetting, or the date across the top? I’m no lawyer, but my mentor once told me that a contract “is just a piece of paper until both parties have signed it.” So, if you’re being asked for the date of a contract on a purchase sale agreement for an appraisal, which date do you choose? To the best of my understanding, you select the date of the most recent signature. This is, after all, when the contract became a contract. Let me show you.
Suppose you have two people who are signing a contract. The contract is written up, and includes a date at the top, “August 27, 2021”. Below, one of the parties has signed it, and dated their signature as August 27, 2021. However, the second individual doesn’t sign it until a day later: August 28, 2021. If a contract needs both signatures in order to be a true, binding contract, then it follows that it does not truly become a contract until the second signature has been given. Before that event, it is simply a piece of paper with fancy words and maybe a name at the bottom.
So next time you’re left wondering, “Which date do I choose,” I would say, “Choose the date of the most recent signature.” After all, a contract is just a piece of paper until both people have signed it. Thus the date of contract would be, in my view, the day it became legal and binding: the day it actually became a contract.
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7 thoughts on “A Contract is Born”
What’s the contract date associated with you selling out to corporate greed, and ending the charade of being an appraiser? Asking for a friend.
Seek the truth, and question those who say they are here to help as often times they turn into the enemy (taking +/- 50% of the fee).
Question, what about the counter offers, is the contract date the date the last person signed the offer or the most current signature date on the most current counter?
Good article. What is a counter offer in a sales contract. A counter offer states that you or the party (buyer) making the original offer HAS NOT been accepted by the seller. Once again, your contract has to have both signatures. The seller does not accept the offer, but counter’s the buyer’s offer with a NEW offer. The buyer, can do the same, counter the seller. The end result is that you have to have two signatures that both agree to the terms of the contract. The last signed date (acceptance of contract) becomes the ratification date.
My Grandpa sold many houses as broker just with oral agreement on purchase price and a handshake. Back when your word still mattered.
Good reminder.
Considering the author quit and sold his appraisal business so he could work for an AMC/valuation company Clayton, not that I ever believed and drank his Kool-Aid, but I would think Dustin’s words don’t matter anymore. Do as I say, and not as I do right Dustin?
Seek the truth.
It’s all about “mutual assent”, complete agreement on price and all pertinent terms of the written agreement. The seller’s acceptance of the final offer with specified terms with a dated signature by all parties to the agreement. The last date is the date the appraiser relies upon.