Real Estate Terms Dictionary
Memorandum of Contract
Definition of 'Memorandum of Contract'
A memorandum of contract, also known as a "memorandum of understanding (MoU)", is a form preceding a contract of sale, in which two parties agree upon the same objective--the sale/purchase of a property.
What is a Memorandum of Contract:
A memorandum of contract is less legally binding than a contract and it can be used to outline the terms and details of the agreement before the contract is drawn. It can be used in court when one party fails to meet one or more of the obligations stated in the agreement.
Here's a real-life example from one of the properties researched on PropertyShark:
The glossary is intended to provide real estate professionals and home buyers with a basic understanding of various specialized terms related to legal rights over a property. All terms appear in public records such as ACRIS. We do not take responsibility for the legal accuracy of the definitions provided and ask that use of these explanations in a legal setting be made only after checking with a lawyer or another specialist in the field.