Key Takeaways
- Virginia real estate contracts must be in writing per the Statute of Frauds to be enforceable
- The Virginia Association of REALTORS (VAR) provides standard contract forms used in most residential transactions
- Virginia contracts typically include contingencies for financing, inspections, and home sale
- Earnest money deposits must be deposited promptly in accordance with contract terms
- Virginia follows the "reasonable time" doctrine unless time is of the essence is specified
Virginia Purchase and Sale Agreements
Important: This content covers Virginia-specific contract law. You should complete the National Real Estate Exam Prep first, as general contract principles are tested on the national portion.
Real estate contracts in Virginia must meet all standard contract requirements plus Virginia-specific provisions.
Standard Contract Requirements
For a valid Virginia real estate contract:
| Requirement | Description |
|---|---|
| Competent Parties | Legal age (18+) and mental capacity |
| Offer and Acceptance | Meeting of the minds |
| Legal Purpose | Transaction must be lawful |
| Consideration | Something of value exchanged |
| Written Form | Statute of Frauds requires writing |
| Legal Description | Property must be identifiable |
Common Virginia Contract Forms
The Virginia Association of REALTORS (VAR) provides standard forms used in most residential transactions:
Key VAR Form Provisions
| Section | Purpose |
|---|---|
| Purchase Price | Total price and payment terms |
| Earnest Money Deposit | Amount, holder, and deposit timeline |
| Financing Contingency | Loan type, amount, and conditions |
| Home Inspection | Inspection rights and remedies |
| Settlement Date | Closing date and location |
| Additional Terms | Special conditions and provisions |
Earnest Money Deposits
Virginia practice for earnest money:
- Amount is negotiable between parties
- Should be deposited promptly per contract terms
- Held in escrow by broker, title company, or attorney
- Default: typically handled per contract provisions
Note: The contract should specify where funds will be held and the timeline for deposit.
Key Contract Provisions
Time of the Essence
Virginia follows "reasonable time" doctrine by default, meaning:
- Deadlines are important but may allow flexibility
- Minor delays may not be grounds for default
- If contract specifies "time is of the essence," deadlines are strict
To make time of the essence:
- Must be expressly stated in the contract
- All parties must agree
- Late performance can then be grounds for termination
Contingencies
Virginia contracts commonly include:
| Contingency | Purpose |
|---|---|
| Financing | Buyer must obtain satisfactory loan |
| Home Inspection | Buyer may inspect and negotiate repairs |
| Appraisal | Property must appraise at purchase price |
| Home Sale | Buyer must sell existing home first |
Home Inspection Contingency
Virginia buyers typically have the right to:
- Conduct inspections within specified timeframe
- Request repairs or price reduction
- Accept property "as is" for certain items
- Terminate if major defects are found
Financing Contingency
Protects the buyer if:
- Loan application is denied
- Interest rate exceeds specified maximum
- Loan terms are unacceptable
- Appraisal comes in below purchase price
Contract Amendments
Changes to the contract after signing require:
| Change Type | Method |
|---|---|
| Before acceptance | Counter-offer or new offer |
| After binding agreement | Written amendment signed by all parties |
| Extension of deadlines | Addendum or amendment |
| Material changes | Requires written agreement |
When the Contract Becomes Binding
A Virginia purchase contract becomes binding when:
- All parties have signed the agreement
- Acceptance is communicated to the offering party
- Delivery of signed contract is completed
Important: An offer can be revoked at any time before acceptance is communicated.
In Virginia, what is required for a real estate contract to be enforceable?
What is Virginia's default rule regarding contract deadlines?