Binder

Definition: A preliminary document or arrangement intended to record an agreement or provide temporary coverage. Its legal effect depends on its terms and context.

Example

An insurer issues a binder providing temporary insurance coverage pending issuance of the policy.

Keep the distinction clear

A real estate binder is not automatically a complete purchase contract, and a binder deposit does not by itself settle all essential contract terms.

Related terms

Contract · Earnest Money · Hazard Insurance

Keep studying

Valid, Void, Voidable, and Unenforceable Contracts

References: California DRE: real estate glossary

Pronunciation (US): BYN-der (capitals show stress)

Pronunciation reference: Merriam-Webster