Considerations in a real estate transaction

At its core, considerations are things of value being exchanged that create a mutual obligation between parties and make a contract enforceable.

In most real estate transactions, the seller's consideration would be legal title to the property, in exchange for the buyer's consideration, which would be the agreed upon amount of money to be paid to the seller. There needs to be consideration (something of value) on both sides in order for there to be an enforceable contract.

There is a common misconception that the deposit itself is the buyer's consideration. This is not true. The deposit is a show of good faith that the buyer is serious about paying the consideration (the agreed upon full purchase price).