What defines a formal contract?

A formal contract is defined by several key characteristics, the most significant of which is that it must be signed, sealed, and delivered. This phrase encapsulates the essential components needed for a contract to be considered formal and legally binding. The signing of the contract indicates mutual agreement between the parties involved; sealing traditionally signifies the authenticity and intent behind the contract; and delivering the contract involves the communication and transfer of the contract to the relevant parties, making it effective.

While other aspects mentioned in the options may relate to various administrative or procedural elements in real estate transactions, they do not contribute to the inherent formalization of a contract. For instance, sending something to a notary public for recordation or having it approved by a broker may lend certain legal weight or assist in the transaction process, but they are not fundamental to the definition of a formal contract. Similarly, a contract that is only drafted but not signed does not fulfill the requirements to be recognized as a formal contract, as it lacks the necessary consensus of the involved parties.