Legal FAQs for REALTORS® — Contracts and Forms
Oral Contracts

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My client received an offer on his home. He wants to submit a counteroffer to the prospective buyer and asked me to call the buyer’s agent with the information. The buyer’s broker insists that the seller must either make a formal counteroffer in writing or reject the buyer’s offer in writing. Does my client have to respond in writing? (updated October 15, 2015)

No. A seller has no legal duty to respond to an offer in any particular way. A verbal counteroffer could expedite negotiations for the sale of a property in many cases. Of course, once there is an agreement about the terms and conditions of the sale, the parties should promptly reduce the agreement to writing and sign the contract to make it a binding obligation.

A seller could respond to a buyer's offer by using the Seller's Invitation to Buyer to Submit New Offer (TAR 1926). This form would be particularly useful when the seller's proposal contains several changes to the buyer's offer. By using this form, the seller is free to consider other offers without having to be concerned about the withdrawal of a previous, written counteroffer.


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? (Updated Oct. 27, 2014)

No. A verbal agreement must be reduced to 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.


Legal Disclaimer: The material provided here is for informational purposes only and is not intended and should not be considered as legal advice for your particular matter. You should contact your attorney to obtain advice with respect to any particular issue or problem. Applicability of the legal principles discussed in this material may differ substantially in individual situations.

While the Texas Association of REALTORS® has used reasonable efforts in collecting and preparing materials included here, due to the rapidly changing nature of the real estate marketplace and the law, and our reliance on information provided by outside sources, the Texas Association of REALTORS® makes no representation, warranty, or guarantee of the accuracy or reliability of any information provided here or elsewhere on TexasRealEstate.com. Any legal or other information found here, on TexasRealEstate.com, or at other sites to which we link, should be verified before it is relied upon.

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