How to Negotiate Contracts

Most of life's major events involve the formation of a contract. Buying a car, renting an apartment, even entering into an employment agreement are all events that require you to enter into a legally binding agreement. Accordingly, learning how to effectively and successfully negotiate contracts is a valuable skill.

Instructions

1. Understand that before negotiating a contract, you must first be able to legally enter into a contract. Generally, this means you must be 18 years or older and capable of making informed decisions.

2. Familiarize yourself with the basics of contract law. Realize that a contract basically consists of an offer, acceptance, consideration (usually money) and an intention to create a legal relationship.

3. Research all laws applicable to your contract. This may include landlord/tenant regulations, lemon laws or zoning restrictions. Knowledge of the applicable laws is crucial to forming a legally enforceable contract.

4. Prepare your case. Before coming to the negotiation table, ask yourself what you want, what you are willing to concede and what you refuse to give up. By prioritizing your needs you set the stage for more effective contract negotiation.

5. Apply general negotiation skills. Start with the easy things first to build momentum and to establish a reputation for reasonableness. Ask for more than you are willing to accept and try to find middle ground acceptable to both parties.

6. Understand that contract negotiation is a matter of give and take. Listen to the other side. Stay calm and focused.

Tips & Warnings

• Use a checklist to keep the topics on course during the contract negotiation process.

• Consult a contract attorney if you have any questions regarding your rights or if you want an advocate in the contract negotiation process.