Key Takeaways
- The AAR (Arizona Association of REALTORS) Residential Resale Purchase Contract is the standard form used in Arizona
- Arizona contracts typically include an inspection period during which buyers can investigate the property
- The contract becomes binding when acceptance is communicated to the offeror
- Time is of the essence is standard in Arizona contracts, making all deadlines strictly enforceable
- Escrow companies typically handle closings in Arizona rather than attorneys
Arizona Purchase Contracts
Important: This content covers Arizona-specific contract requirements. You should complete the National Real Estate Exam Prep first, as general contract concepts are tested on the national portion.
Real estate contracts in Arizona must meet all standard contract requirements plus Arizona-specific provisions.
Standard Contract Requirements
For a valid Arizona 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 |
The AAR Residential Resale Purchase Contract
The Arizona Association of REALTORS (AAR) provides standard forms used in most residential transactions.
Key Contract Sections
| Section | Purpose |
|---|---|
| Property Description | Identifies the property |
| Purchase Price | Price and payment terms |
| Earnest Money | Deposit amount and holder |
| Close of Escrow | Closing date |
| Possession | When buyer gets possession |
| Financing | Loan terms and contingency |
| Inspection Period | Due diligence timeframe |
| SPDS | Seller Property Disclosure |
| Warranties | What seller warrants |
Earnest Money
In Arizona:
- Amount is negotiable
- Typically held by escrow company or broker
- Becomes part of purchase price at closing
- Disposition governed by contract terms
Key Contract Provisions
Time is of the Essence
Arizona contracts include "time is of the essence" meaning:
- All deadlines are strictly enforceable
- Missing a deadline can constitute breach
- Extensions require written agreement
Inspection Period
The inspection period allows the buyer to:
- Conduct property inspections
- Review HOA documents
- Investigate title
- Evaluate property condition
Buyer's options during inspection period:
- Accept property as-is
- Request repairs/credits (BINSR form)
- Cancel contract (within the period)
BINSR - Buyer's Inspection Notice and Seller's Response
The BINSR form is used when buyer requests:
- Repairs to be made by seller
- Credits at closing
- Price reduction
Seller can accept, reject, or counter the requests.
Close of Escrow (COE)
The COE date is the scheduled closing date:
- Title transfers on this date
- Funds are disbursed
- Documents are recorded
Cure Period
If a party fails to perform, the Cure Period Addendum may provide:
- 3 days to cure the breach
- Written notice required
- Opportunity to fix the issue before cancellation
When Contract Becomes Binding
A contract becomes binding when:
- Offer is made
- Acceptance occurs
- Acceptance is communicated to the offeror
Arizona Rule: Acceptance is not effective until communicated. Unlike some states, the "mailbox rule" does not automatically apply.
When does an Arizona real estate contract become binding?
What form do Arizona buyers use to request repairs after an inspection?