What is an agreement?
An agreement is a commitment between two or more individuals that contains terms like the partnership purpose, associate contributions, rights, and boundaries. It isn’t needed to create a general partnership nor record your words. However, let your partner sign a legitimately enforceable agreement form whenever there are disputes so that it can be easily resolved.
Six Steps on How to Write an Effective Agreement
An agreement form is vital especially on your wide-range transactions and operations such as lease, apartment, loan, and even setting regulations and boundaries to your roommate, tenant, or consultant for it makes your agreement valid and secure. To help you accomplish your complicated task, we'll show you six easy steps on how you can create an effective agreement form.
1. Determine the Purpose
The initial move in creating an agreement is to have a clear purpose. A study of Roxenhall and Ghauri shows that the first reason why agreements are drawn up is that agreements are utilized to help private partnership purposes by sending data to the accepting party. The purpose is the objectives of two or more parties to enter in an agreement with one another. For instance, a tenant and landlord intend to acquire a legal partnership and relationship as well, so they sign an agreement.
2. Establish a Proposal
If ever parties have set their purpose in entering a contract already, one must establish a proposal to the opposite party to achieve a task or render a service. Keep in mind that both parties must validate the proposal first. Even if one party has created an offer, it can't exist until the other party gives its permission.
3. Determine the Duration of the Agreement
If the proposal is made, it doesn't continue endlessly. In an agreement, the offering party must specify the span of the proposal on when it will remain valid and how long the accepting party has to take it. Decide if it will be a long-term or short-term agreement.
4. Recognize the Obligations and Payments
Obviously, an agreement letter or contract must include the obligations of both parties. In its most simplistic manner, the agreement letter or form should clearly describe the obligations of each party that must be performed to maintain a valid agreement. Furthermore, methods of payments must be presented in the agreement letter. The payments that we're referring to are what one party gains from the opposite party after the obligations of the agreement are accomplished. This can be in the form of finances, services, products, or anything that possesses a price.
5. List It Down
Present your agreement on a sheet of paper or document. This document keeps a record of all the legal terms and conditions agreed in the arrangement. In its simplest sense, this will act as your evidence that will prove regarding the deal of both parties. For instance, a widow could sell her vehicle to her friend. In this scenario, she could utilize an agreement to prove that her friend is already the full-fledged owner of the said vehicle.
6. Resolving Disputes and Agreement Approval
A current study of AnchorsGordon states that business contracts are designed to prevent lawsuits and disputes from happening. Therefore, the agreement should cover the methods of how issues or disputes will be settled. Various agreement letters include an intervention requirement that specifies that both parties must use arbitration instead of a lawsuit so issues will be resolved. Also, the agreement is only legitimate when the accepting parties accept its terms.