If a seller receives a purchase offer from a prospective buyer, which is acceptable, the seller simply signs the offer as his/her acceptance and the accepted offer becomes a contract. If, however, the seller requires any changes to the offer in order for it to be acceptable, the seller proposes these changes to the buyer in writing. This is called a “counteroffer”. Since a counteroffer is actually a further proposal, the buyer must accept it before it becomes a contract. Similarly, the buyer may make a counteroffer to the counteroffer, and so on, until both parties agree upon the terms of the transfer. However, at any stage of the process, if either party simply rejects the offer or counteroffer of the other party without making a further counteroffer, the negotiations are terminated and no contract is established.
