What is a binding offer?


A binding offer, according to Nolo, is any type of action that legally binds separate parties together under a contractual agreement. Contracts with offers take many forms, from simple to complex. For example, a simple binding offer is initiated by a cab driver who stops to pick up a passenger. The passenger accepts the offer of a ride and pays the driver, which creates a legally binding contract.

Nolo explains that another example of a binding offer is when business A makes an offer to purchase equipment from business B for a specific price. A contract is drawn up stating the terms of the sale. The contractual offer is one part of a legal contract but does not become legally binding in a court of law unless business B accepts the offer by signing the contract.

Nolo further posits that a binding offer sometimes remains open for a time to allow another party to make a decision on whether or not to accept. This is also known as an option agreement, which is a temporary way of keeping an offer on hold. Offers are sometimes conditional as when one party responds to an offer by requesting additional qualifications be met. Sometimes a counteroffer is presented as an alternative to an existing offer, which is legally considered a rejection of the original offer. Counteroffers are not legally binding unless the new offer is agreed upon.

Q&A Related to "What is a binding offer?"
Obviously a non-binding offer is an offer that isn't binding. But beyond the semantics - what is it really? Two of the condo projects in our area, one that recently filed bankruptcy
Hi Pat - You should be able to simply withdraw your offer to buy the property. If you are under contract pending the release of a contingency you are not bound to wait forever on
In the play Othello, Iago offers to bind up Cassio's wound with his
It depends on what the paperwork says, I know many people back out of offers with little if any problems. My sister sold her house and had two people back out of their offer because
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For a verbal agreement to be legally binding, it must have the following elements: offer and acceptance, consideration, permissible subject matter, legal age and ...
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