Most Massachusetts buyers believe the purchase and sale agreement is the moment they become committed. By then, they usually already are.
Under Massachusetts law, a signed and accepted offer to purchase can itself be a binding contract. The purchase and sale agreement, or P&S, is not where you decide to buy the home. It is where the terms of that purchase get written properly.
That makes the P&S the most important document you will sign before closing. It sets your deposit at risk, defines your escape routes, and determines what happens if financing falls apart. Roughly two weeks after your offer is accepted, you sign it. This is what to understand first.
Isn’t the Offer Just a Formality?
No. In 1995, a buyer signed a standard offer form for a property, and the seller accepted it. The seller then agreed to sell to someone else. The buyer sued.
The Supreme Judicial Court held that the offer was a binding contract, and that signing the later P&S was “merely a formality.” The buyer was entitled to the house. (McCarthy v. Tobin, 429 Mass. 84 (1999))
Massachusetts offer forms usually carry a notice in bold above the signature line warning that the document creates binding obligations. That notice means what it says.
So the practical advice is uncomfortable but simple. Get advice before you sign the offer, not after.
What Does the P&S Change?
The offer is short. The P&S is long, and it fills in what the offer left out:
- Title. What quality of title the seller must deliver, and what happens if a defect appears.
- Condition. The property’s state at the final walkthrough compared with the inspection.
- Deadlines. Financing dates, closing date, and whether time is strictly enforced.
- Deposit terms. Who holds it, when it is released, and when it is forfeited.
- Seller obligations. Smoke and carbon monoxide certificates, and a 6(d) certificate for a condominium.
- Remedies. What each side can actually do if the other fails to perform.
Why Isn’t the “Standard Form” Neutral?
Because it was not designed to be.
The commonly used form is a starting point drafted with the seller in mind. Left unrevised, it can leave a buyer’s exposure uncapped and gives the buyer limited leverage on title problems.
This is why the P&S is negotiated between attorneys before signing. Your attorney typically adds a rider — additional terms that adjust the form in your favor. Capping your damages at the deposit is one common example.
There is no automatic statutory review window in Massachusetts. The review period exists because your offer created one, or because your attorney negotiated for it.
What Happens to My Deposit If I Walk Away?
You likely lose it.
A typical Massachusetts deposit is $1,000 with the offer, then five percent of the purchase price at the P&S. That larger deposit usually functions as liquidated damages, meaning the seller keeps it if you default without a valid contractual excuse.
Massachusetts courts enforce these clauses firmly. In one case, buyers put down five percent, could not sell their existing home, and backed out. The sellers then resold the property for more than the original price — and still kept the entire deposit.
The SJC held that the question is whether the amount was a reasonable forecast when the contract was signed, not whether the seller actually lost money. (Kelly v. Marx, 428 Mass. 877 (1999))
A Newton example. A couple buys at $1,200,000 and deposits $60,000 at the P&S. Their financing contingency expires on a Friday. Their lender is still processing, and no one sends written notice.
The contingency lapses. If they cannot close, that $60,000 is at risk — even though nothing was anyone’s fault. The deadline was the protection, and the deadline passed.
How Do Contingencies Actually Protect Me?
They protect you only if you use them correctly.
The financing contingency lets you terminate and recover your deposit if you cannot obtain a mortgage commitment by a set date. But you must apply promptly and give written notice by the deadline. Miss the notice, and the protection is gone.
Inspection is now handled differently than it was a few years ago. Since October 2025, Massachusetts sellers and their agents cannot condition acceptance of an offer on a buyer waiving or limiting a home inspection. A seller also may not accept an offer where the buyer has signaled an intent to waive. Buyers and sellers sign a state disclosure form before the first written contract. (760 CMR 74.00 mandatory disclosure form, Mass.gov)
You may still choose to skip an inspection. You simply cannot be pressured into it. (Executive Office of Housing and Livable Communities announcement)
Frequently Asked Questions
Can I cancel after signing the P&S? Only through a contingency, and only by following its terms exactly. If you cancel for any other reason — cold feet, a job change, a lost sale on your current home — the seller can generally keep your deposit as liquidated damages under Massachusetts law.
How long after my offer do I sign the P&S? Usually about ten to fourteen days, though the offer sets the actual date. That short window is when inspections happen and attorneys negotiate terms, so it moves faster than most buyers expect.
Who holds my deposit? Typically the listing broker or an attorney, in escrow. The P&S specifies the escrow agent and the conditions for release. Escrowed funds are generally not released to either party while a dispute is unresolved.
Do I need an attorney for the P&S? Massachusetts practice assumes attorney involvement, and the standard forms themselves advise consulting one. An unrevised form leaves a buyer with less protection than most people assume.
This article provides general information about Massachusetts law. It is not legal advice and does not create an attorney-client relationship. Contract terms, deadlines, and remedies vary by transaction.
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