A sales agreement is a legal and binding document regarding the transfer of property between two parties. It creates an obligation for a purchaser to buy and for a seller to sell a product/service/property.
A sales agreement provides a basis for negotiation between seller and buyer. It also helps both parties agree on a price and documents it. This eliminates potential for disputes later on that may occur with verbal agreements. The sales agreement also contains important information on both parties along with the terms of the sale.
Not all sales require a sales agreement. They are commonly used for large, singular transactions or for frequent purchases over a limited period of time. However, it is most often used for selling real estate property. Businesses also use sales agreements when purchasing large amounts of material from suppliers or when acquiring another company.
These are some of the details a sales agreement should contain in order to provide both parties with as much security as possible:
A sales agreement is only then signed off when all the conditions written into it have been met, such as an inspection of the goods or the real estate property being sold, for example. Once signed, it becomes binding for both parties.
Since a security deposit is often required and these are usually non-refundable, the buyer should be absolutely certain that they wish to move forward with the purchase. The seller, on the other hand, should make sure to receive a deposit to protect themselves to a certain degree at least.