What to know about real estate agent contracts Real estate contracts are agreements between two or more parties involved in a real estate transaction. Types of real estate contracts include leasing agreements, listing agreements, and buyer’s agent agreements. Although laws vary by state, real estate contracts normally have to be in writing to be enforceable. Contracts are necessary because they outline what’s expected of each party involved.

For example, a purchasing agreement is a contract between a buyer and a seller that includes the purchase price, earnest deposit amount and other important details. Having a contract in place can protect all parties, including buyers, sellers and real estate agents. For instance, a purchase agreement that includes an appraisal contingency can protect a buyer from purchasing a home for more than it may actually be worth. As real estate agents, a contract ensures that they get paid their commission when a real estate transaction is completed. Like any other contract, an agreement with a real estate agent is legally binding. This means that if you break it, you may have to pay a fee.