What legally binds a buyer and seller in the sale of real estate?

The sales contract serves as the legally binding agreement between a buyer and a seller in the sale of real estate. This contract outlines the terms and conditions of the transaction, including the purchase price, property description, closing date, and any contingencies that must be met before the sale is finalized. By signing the sales contract, both parties agree to the specified terms and are obligated to fulfill their commitments to complete the transaction.

Title insurance policies, while important, primarily protect against potential defects in the title after the sale has closed and do not establish the terms of the sale. Mortgage agreements are related to the financing of the property purchase rather than the sale itself, serving to outline the borrowing terms between the buyer and lender. A warranty deed, on the other hand, is a legal document that transfers title from the seller to the buyer and guarantees that the seller has clear ownership; however, it does not constitute the agreement for the sale itself.