If you’ve ever bought or sold a home, or even just thought about it, you’ve probably heard the term bilateral contract. But what is a bilateral contract in real estate, and why should it matter to you, especially if you’re trying to sell your home fast?

Let’s break it down in simple terms.

A bilateral contract is the standard agreement used in most real estate deals. It’s a two-way promise: you agree to sell, and the buyer agrees to buy. But while it might sound straightforward, there’s a lot going on under the surface. These contracts come with deadlines, legal requirements, and often, delays.

In this blog, we’ll explain what makes bilateral contracts tick, how they fit into the real estate contract timeline, and when they might not be your best option, especially if you’re looking for a fast, stress-free sale.

First Things First: What is a Bilateral Contract in Real Estate?

If you’re selling your home, one of the first things you’ll run into is something called a bilateral contract. But what is a bilateral contract in real estate, exactly, and why does it matter?

Let’s keep it simple.

A bilateral contract is a legal agreement where both the buyer and the seller make promises to each other. It’s a two-way street. Both sides agree to do something, and both are legally responsible for following through.

While bilateral contracts are the most common in real estate, they’re actually just one of several types of real estate contracts used in property transactions.

Here’s how that usually works:

• The buyer promises to pay a certain amount of money for the home.
• The seller promises to hand over ownership of the property (this includes the title, keys, and all legal rights).

Once both parties sign the contract, it’s considered legally binding. That means if either side tries to back out or doesn’t keep their end of the deal, the other side can take legal action.

What Happens If Someone Breaks the Contract?

This is a common question, and an important one.

Let’s say you’re the seller. You’ve accepted a buyer’s offer, signed the contract, and started packing. Then, out of nowhere, the buyer changes their mind and walks away.

If the buyer doesn’t have a valid reason (like a failed inspection or loan denial under a contingency), they could lose their earnest money deposit, which is usually 1% to 3% of the home’s price. That money typically goes to you as compensation for wasting your time and taking your home off the market.

Now flip it.

Let’s say you’re the buyer. You’ve done everything right, got approved for your loan, passed the inspection, and now the seller suddenly refuses to move out or won’t sign the final paperwork. In that case, you might be able to sue to enforce the contract, which could force the seller to go through with the sale or pay damages.

This mutual accountability is what defines a bilateral contract. It’s designed to protect both sides, but that doesn’t always mean it’s smooth or stress-free.

Understanding when and how buyers can back out of contracts is important for sellers to know what they’re getting into.

Are Bilateral Contracts the Only Kind Used in Real Estate?

Not necessarily.

While bilateral contracts are the most common in real estate, especially when dealing with traditional home sales, there are also unilateral contracts. These are one-sided agreements where only one party is required to act if certain conditions are met. For example, an open listing agreement with a real estate agent is often a unilateral contract: the seller agrees to pay a commission, but only if the agent finds a buyer.

That said, if you’re buying or selling a home, you’re most likely going to deal with a bilateral contract. It’s the industry standard.

So Why Should Sellers Care?

If bilateral contracts are so common, why does it matter to you?

Here’s the thing: while these contracts offer legal protection and structure, they don’t always move quickly. And if you’re someone who needs to sell your house fast, maybe you’re relocating, going through a major life change, or trying to sell a rental with tenants still in it, then the typical process might not work in your favor.

Why? Because bilateral contracts often include things like:

• Financing contingencies – giving the buyer time to secure a mortgage
• Inspection contingencies – allowing the buyer to renegotiate if repairs are needed
• Appraisal contingencies – letting the buyer back out if the home’s value doesn’t match the price

Each of these steps adds time, and each one is a chance for the deal to fall through. Even after signing a bilateral contract, it could still take 30 to 60 days, or more, to close. And in some cases, the buyer might still walk away.

Let’s say you’re selling your house in Georgia. You sign a bilateral contract with a traditional buyer who’s getting a mortgage. You agree on the price and closing date.

The Hidden Delays in Bilateral Contracts

A week later, the inspector finds minor issues, and the buyer requests repairs—adding 10 days. Then the appraisal comes in low, and they want to renegotiate, delaying closing another 2–3 weeks.

If you’re counting on the sale to buy another home, pay off debt, or settle an estate, that “simple” contract quickly becomes stressful.

That’s why many sellers turn to faster options, like selling directly to a cash buyer. While bilateral contracts are common, they aren’t always the best choice. If you need speed, want to avoid repairs and showings, or are selling with tenants, working with a trusted cash buyer like Golex Properties can save time, hassle, and uncertainty.

Real-Life Example of a Bilateral Contract

Let’s say you’re selling a rental home in Georgia, and a buyer makes an offer. You accept. You both sign a purchase agreement. That document is a bilateral contract: you promise to sell, they promise to buy.

But here’s where it can get complicated:

• The buyer still has to get financing.
• They might want an inspection and request repairs.
• Their lender might require an appraisal.
• If the tenant won’t leave on time, it might delay closing.

So while the contract is legally binding, it’s not a sure thing until every step is complete. And those steps? They can take weeks, or even months.

Inside the Real Estate Contract Timeline

Once you and a buyer sign a contract, the clock starts ticking. But don’t expect to close the deal overnight.

The real estate contract timeline, or the step-by-step process from accepting an offer to officially selling your home, can take anywhere from 30 to 60 days on average. And that’s if everything goes smoothly. The timeline involves a lot of moving parts, and any delay from a lender, inspector, or buyer can slow things down.

In contrast to these lengthy timelines, cash transactions can close much faster, often in just days rather than months.

Let’s walk through each step so you know exactly what to expect when selling your home the traditional way.

1. Offer & Acceptance (Days 1–3)

This is the first official step. A buyer submits an offer, and you either accept it, reject it, or negotiate terms (like price, closing date, or repairs).

Once you both agree and sign the contract, you’re now in a bilateral agreement, meaning you’re both legally bound to follow through, assuming all conditions are met.

Real-life tip: Some buyers include an expiration date on their offer to encourage a quick response, so it’s important to review offers promptly.

2. Earnest Money Deposit (Days 3–5)

After signing the contract, the buyer puts down what’s called an earnest money deposit, usually around 1% to 3% of the purchase price. This money is held in escrow and shows they’re serious about buying your home.

If the buyer later backs out without a valid reason, you may be entitled to keep that deposit.

Why it matters: This step gives you, as the seller, some security. But it’s not a guarantee that the sale will go through. The buyer still has time to change their mind if something comes up during the next steps.

3. Home Inspection Period (Days 5–15)

During this stage, the buyer typically hires a licensed home inspector to check the property’s condition. They’re looking for issues like:

• Roof damage
• Foundation cracks
• Electrical or plumbing problems
• Mold, pests, or water damage

If the inspector finds problems, the buyer might:

• Ask you to make repairs
• Request a credit or lower sale price
• Walk away from the deal entirely (if their contract includes an inspection contingency)

Let’s say the inspector finds signs of termite damage. Even if it’s minor, the buyer may want a treatment done, or use it as leverage to lower their offer. If you’re not prepared for this, it could delay closing or even cancel the deal.

4. Appraisal & Loan Approval (Days 15–30)

If your buyer is using a mortgage (which most do), their lender will order a home appraisal to make sure the home is worth the agreed sale price. If the appraisal comes in low, the lender may refuse to finance the full amount.

This could lead to:

• The buyer coming up with more cash
• You, as the seller, lowering the price
• The deal falling through if neither side budges

Common problem: Appraisals are based on recent sales in your area. If there haven’t been many, or if prices have dropped, your home might be valued lower than expected, even if the buyer offered full asking price.

At the same time, the lender is processing the buyer’s loan. They’ll check the buyer’s credit, income, debt, and employment. Any hiccups in the buyer’s financials can also delay or kill the deal.

5. Title Search & Closing Prep (Days 30–45)

Once the appraisal and loan are approved, the title company steps in. Their job is to make sure you legally own the home and that there are no hidden problems, like unpaid taxes, liens, or ownership disputes.

If the title is clear, the company prepares closing documents, including:

• The deed
• Settlement statements
• Transfer paperwork

If issues are found: Something as small as a clerical error on a past deed can cause delays. More serious issues, like a lien from a past contractor or an unresolved estate matter, might take weeks to resolve.

6. Closing Day (Usually 30–60 Days After Signing)

This is the finish line. You and the buyer meet (or sign separately) to go over and finalize all documents. Once everything is signed, funds are transferred, and you hand over the keys.

Congratulations, you just sold your home!

But here’s the honest truth: this step only happens after a long process filled with potential roadblocks.

So, How Long Does It Really Take?

Even though the contract is signed early on, the full real estate contract timeline often lasts 30 to 60 days. And it can stretch longer depending on how fast the buyer moves, whether they’re approved for financing, what comes up in the inspection, and how clean the title is.

Here’s a quick recap of where things can get delayed:

• Buyer financing issues
• Low appraisal value
• Inspection problems
• Title disputes or paperwork errors
• Repairs or renegotiations

If everything goes perfectly, you might close in 30 days. But if anything at all goes sideways, the process can stretch into weeks or months, and you’re stuck waiting.

What If You Don’t Want to Wait?

If you’re reading all this and thinking, “That sounds like a headache,” you’re not alone. Many homeowners, especially those who need to sell fast, prefer to skip the long contract timeline altogether.

That’s why companies like Golex Properties offer a better alternative.

When you work with us, you avoid:

• Agents
• Repairs
• Inspections
• Appraisals
• Financing delays

We buy homes as-is for cash, and we can close in as little as 7 days. Whether you’re selling a rental with tenants or just need to move on quickly, we make the process simple and stress-free.

Pros and Cons of Bilateral Contracts

If you’re selling your home, signing a contract might feel like the finish line, but with a bilateral contract, it’s really just the start of the process. Like most things in real estate, there are pros and cons to using this type of agreement.

Understanding the benefits and risks can help you decide if it’s the right move for your situation, or if a faster, simpler option might make more sense.

Pros of Bilateral Contracts

1. Clear responsibilities for both parties
One of the biggest advantages of a bilateral contract in real estate is that everything is written down. The buyer knows what they’re agreeing to (usually a specific purchase price and closing timeline), and the seller knows what they need to do (typically transferring the title and handing over the property in a certain condition). This structure helps avoid confusion and misunderstandings.

2. Legal protection for everyone involved
Because it’s a legally binding agreement, a bilateral contract offers protection if something goes wrong. If a buyer breaks the contract without a valid reason, the seller might get to keep the earnest money. If a seller refuses to honor the deal, the buyer can potentially sue to enforce the agreement.

3. Common and widely accepted in traditional sales
If you’re selling your home through a real estate agent or listing it on the open market, a bilateral contract is the standard way to move forward once you’ve accepted an offer. Most buyers, agents, lenders, and attorneys are used to working with them.

Cons of Bilateral Contracts

1. Contingencies can let buyers walk away
Even though the contract is binding, most bilateral contracts include contingencies, which are conditions that must be met for the deal to go through. These usually cover financing, inspections, and appraisals. If something doesn’t go as planned, the buyer can cancel the contract without losing their deposit. This puts the seller back at square one.

2. You’re relying on third parties
Traditional real estate deals aren’t just between the buyer and seller. Banks, inspectors, appraisers, and title companies all play a role, and they can slow things down. If a single piece of paperwork gets delayed or a third party makes a mistake, the entire closing could get pushed back.

3. It’s a slow process
Most sales involving a bilateral contract take 30 to 60 days or more to close. Even if you’re ready to move tomorrow, you’ll be stuck waiting on the buyer’s financing, inspections, and other requirements. For sellers who need to move quickly, maybe due to a job relocation, inheritance, or financial pressure, this delay can be a serious drawback.

4. Deals can fall through at the last minute
A signed contract doesn’t guarantee a sale. Buyers can back out for a number of reasons, and when they do, sellers lose valuable time and may even miss out on other interested buyers.

What Can Go Wrong with a Bilateral Contract?

Even though bilateral contracts are designed to keep everyone on track, they don’t prevent problems. In fact, according to real estate industry data, roughly 25% of home sales fall through before closing. That means 1 in 4 deals never make it to the finish line.

Here are some of the most common reasons why:

The buyer loses financing

Everything could be going smoothly, until the buyer’s lender does a last-minute credit check and decides not to approve the loan. Suddenly, the deal is off, even if you’ve already started packing boxes.

The appraisal comes in low

If the buyer is using a mortgage, the lender will require an appraisal to make sure the home’s value matches the sale price. If it comes in low, the bank won’t lend the full amount. This puts the buyer in a tough spot, and many walk away if you’re not willing to lower the price.

Let’s say you agree to sell your home for $250,000. The appraisal says it’s worth $230,000. The buyer either needs to pay the $20,000 difference out of pocket, or you’d need to reduce the price. If neither happens, the deal dies.

The buyer finds another home

Until closing day, buyers can, and sometimes do, get cold feet. If they find a “better” property or simply change their mind, they may use a contract loophole (like a contingency) to walk away.

Inspection problems lead to renegotiation or cancellation

A home inspection can uncover everything from mold and roof damage to outdated wiring. If the buyer isn’t comfortable with what they find, or if you refuse to make repairs, they may cancel the contract altogether.

The home is occupied by tenants who won’t leave

If you’re selling a rental property, existing tenants can create delays. In some states, you may be required to give 30 to 90 days’ notice, depending on the lease and local laws. If your buyer wants the property vacant and the tenants don’t cooperate, the entire deal can fall apart.

Is a Bilateral Contract Right for You?

If you’re in no rush to sell, your home is in great condition, and you’re comfortable waiting out the process, a bilateral contract might be just fine.

But if you’re dealing with any of the following:

• You need to sell quickly
• You’re managing a property from out of state
• The home has repairs or code violations
• You’re selling a tenant-occupied property
• You want to skip the stress and uncertainty

…then a bilateral contract might not be your best option.

At Golex Properties, we help homeowners in Florida and Georgia avoid these problems by offering fast, cash-based solutions. We buy houses in any condition, even with tenants still living in them. There are no agents, no inspections, no financing delays, and most importantly, no surprises.

Is There a Faster, Easier Option?

Yes, and this is where Golex Properties comes in.

We help sellers in Florida and Georgia avoid the hassle of traditional sales by offering:

• Fast cash offers
• Closings in as little as 7 days
• No agents, fees, or commissions
• No repairs or inspections
• We even buy with tenants in place

Instead of signing a long bilateral contract filled with conditions and delays, we keep things simple. You accept our offer, we handle the paperwork, and you get paid, quickly and painlessly.

When Does a Cash Sale Make More Sense?

A traditional bilateral contract might be fine for some sellers, but it’s not ideal for everyone. You might want to skip the red tape if:

• You need to move quickly for a job, family, or financial reasons.
• You inherited a home and don’t want to manage it.
• You’re a landlord ready to sell, even if the tenants are still there.
• The home needs major repairs you don’t want to fix.
• You’ve tried listing it already, and it didn’t sell.
• You just want to avoid the stress and get it done.

What is a Bilateral Contract in Real Estate?

To sum it up, what is a bilateral contract in real estate? It’s a legally binding agreement where both the buyer and seller agree to specific terms, most commonly used in traditional home sales. But while these contracts offer structure and legal protection, they also come with delays, complications, and potential fallout.

If you’re looking for a simpler, faster way to sell, without waiting on financing, inspections, or unpredictable buyers, Golex Properties is here to help.

We buy homes as-is, for cash, and can close on your timeline. If that sounds like the solution you’ve been searching for, click here to get your free cash offer.