What does 'Ratified Contract' Mean?

By
Real Estate Broker with The Momentum Group

What does 'Ratified Contract' Mean?

Dear Holly,

We have had our house listed for sale and last week we got a contract. We are waiting to hear back about the Home Inspection right now. Every time I speak with my Realtor® she calls our contract a 'Ratified Contract.' What does this mean? What is the difference between a 'Contract' and a 'Ratified Contract?'

Confused in Northern Virginia

Dear Confused,

Like every other field, Real Estate is a discipline that has its own language. All Realtors® know the lingo, but we forget that not every one understands our 'Realtor® Speak.'

What you received last week was an Offer. After discussing the Offer with your Realtor, you most likely Countered (went back to them with YOUR Offer).  This cycle can go back and forth until the two parties reach agreement.  This is how your sales contract ends up with scratched out terms and initials. Each time a party Counters, they are essentially making a brand new Offer. Once the parties have agreed on the terms of the contract, and all changes are initialed and all blanks are initialed and/or signed, you have what is called Ratified Contract--a contract to purchase your home at terms agreeable to all parties.

A Ratified Contract will likely still  have Contingencies...but that is a post that I covered yesterday, 
  What is the big rush to clear the contingencies?

I hope this helps!

Holly

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Topic:
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Reston, Virginia
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Tags:
contingencies
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real estate questions

Comments 12 New Comment

Rainmaker
1,160,272
Gene Riemenschneider
Turning Houses into Homes
Home Point Real Estate

Nice post.  I have been meaning to do a series on basic real estate terms.  Thanks for the prompt.

April 14, 2011 01:01 PM
Ambassador
2,266,635
Patricia Kennedy
For Your Home in the Capital
Evers & Company Real Estate, Inc.

Holly, you are so right.  Like many professions, we have our own language.  And our clients are not always bilingual!

April 23, 2011 10:20 AM
Ambassador
2,266,635
Patricia Kennedy
For Your Home in the Capital
Evers & Company Real Estate, Inc.

 

Hey, Holly!

I included this post in today's Last Week's Favorites! 

Cheers!

Pat

April 24, 2011 10:53 AM
Ambassador
1,754,011
Jeff Dowler CRS
Carlsbad CA Homes for Sale (760) 840-1360
Solutions Real Estate

Holly

A short, simple and easy explanation. We tend to call them executed contracts here. Our Offer to Purchase further states that a bindng contract is formed when a signed copy of the seller(s) acceptance is received by the buyer or the buyer's authorized agent.

Jeff

April 24, 2011 11:46 PM
Ambassador
289,087
Linda K. Mayer
Realtor, SRES, SoCAL, A REALTOR YOU CAN TRUST
License # 01767321

Easy explaination for clients.  hanks, Holly!

April 27, 2011 01:30 PM
Rainmaker
532,341

Holly Weatherwax

Keller Williams Realty, Northern Virginia
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