3.1 Nevada Contract Requirements

Statute of Frauds and Contract Validity

Under Nevada's Statute of Frauds (NRS 111.205), any contract for the sale of real property, or a lease longer than one year, must be in writing and signed by the party to be charged (the person you are trying to hold to the deal) or that party's authorized agent. An oral agreement to sell a home in Las Vegas is unenforceable in court no matter how many witnesses heard it. This is the single most-tested contracts fact on the Nevada state exam.

A contract is only valid if every element below is present. The exam loves to remove one element and ask whether a deal is enforceable.

For real property add a legal description (lot/block, metes-and-bounds, or government survey). A street address alone is usually insufficient to satisfy the writing requirement for a deed.

Counteroffers and Acceptance

Nevada uses the mirror-image rule: acceptance must match the offer exactly. If the seller returns the contract changing the price from $420,000 to $435,000, that is a counteroffer. The buyer's original offer is dead and the buyer is now free to accept, counter again, or walk away.

• A counteroffer terminates the original offer; the original cannot later be revived by simple acceptance.
• An offer can be revoked any time before acceptance is communicated.
• Acceptance by email or e-signature is valid in Nevada under the Uniform Electronic Transactions Act, so "email contracts are never valid" is false.

Earnest Money Handling

Earnest money is a good-faith deposit showing the buyer is serious. It is client trust money, and mishandling it is one of the fastest ways a licensee loses a Nevada license.

Worked example: A buyer offers $300,000 with $5,000 earnest money. The salesperson receives the check. Correct procedure is to deliver it to the broker for deposit into the trust account per the contract timeline (often 1 business day). Depositing it into the agent's checking account "just until escrow opens" is illegal commingling/conversion, even if the agent intended to forward it.

Common Contract Contingencies

A contingency is a condition that must be satisfied or the buyer (or seller) may cancel. If a contingency fails by its deadline and the buyer cancels properly, the buyer typically recovers the earnest money.

Financing contingency

• Buyer must apply for the loan in good faith within a set number of days.
• If the loan is denied despite a diligent application, the buyer can cancel and recover earnest money, often with a denial letter as proof.
• A buyer who simply never applies has acted in bad faith and may forfeit the deposit.

Inspection contingency

• A typical Nevada inspection period runs about 10-15 days.
• During it the buyer can accept the property, request repairs or credits, or cancel.
• Sellers must still comply with the Seller's Real Property Disclosure Form (NRS 113.130) regardless of inspection results.

Appraisal contingency

• Protects the buyer if the lender's appraisal comes in below the contract price.
• Options: seller lowers price, buyer pays the gap in cash, the parties split the difference, or the buyer cancels.

Time Is of the Essence

Most Nevada purchase agreements state "time is of the essence," meaning deadlines are strict and binding. Missing the inspection or loan deadline can constitute a breach, and any extension must be in writing and signed by both parties. Verbal "we'll give you a few more days" promises are unenforceable.

How Contracts End

Know the difference between an executory contract (signed but not yet closed) and an executed contract (fully performed at closing). On the exam, a signed purchase agreement pending closing is executory, even though it is fully signed.