It’s no mystery that contracts are the foundation of most business relationships. They are there to protect all parties involved, clarify obligations, and prevent any potential misunderstandings.

But do you really need a lawyer to write a contract?

While it’s often wise to hire a professional for complex or high-stakes agreements, it’s not always necessary to create a legally binding contract. This is often the case for straightforward agreements like freelance contracts, service agreements, or small business deals (which we’ll get into more later).

As long as you include all the essential elements required by law, you can use a well-structured template (with all the necessary clauses), which can save you time and money.

Of course, if you have any doubt or if you’re dealing with a complex agreement (think: high-value transactions, intellectual property rights, multi-party deals, etc.), consulting a legal expert might be the way to go.

In this article, we’ll cover all you need to know about how to write a legally binding contract without a lawyer, including step-by-step tips, must-have clauses, and when you may still need legal advice.

The short answer is yes, you can. In a lot of cases, you can create your own contract without a lawyer and have it hold up in court. The key is making sure it meets the legal requirements for validity.

Many individuals and businesses create their own agreements all the time.

Here are a few common examples:

  • Freelance or consulting agreements
  • Non-disclosure agreements (NDAs)
  • Service contracts
  • Lease agreements for personal property
  • Partnership agreements between small businesses

Now, if the contract involves high financial stakes, complex clauses (think: indemnity or liability waivers), or specialized legal language, it’s worth consulting a lawyer before you finalize and sign any documents.

What makes a contract legally binding?

You need to make sure your contract is enforceable, which means it needs to have a few basic requirements. If it doesn’t have these elements, it’s possible it won’t hold up in court.

Here’s what you need to include:

  • Offer and acceptance: One party should make a clear offer while the other party agrees to the terms.
  • Consideration: This means that something of value (money, goods, services, etc.) is being exchanged.
  • Capacity: All parties must be legally capable of entering into the agreement (e.g., of sound mind and legal age).
  • Mutual intent: All parties need to show a clear intention of entering a legally binding contract.
  • Legality: All of the contract’s subject matter must be legal.
  • Signatures: Both parties should sign and date the document.

Now that you have a basic understanding of what’s involved with making a legal contract, now it’s time to draft it.

When creating your own, you should make sure it’s clear and complete. Once you’ve determined that it’s not overly complex and in need of a legal counsel, you can follow these steps and best practices to make sure you create a solid agreement:

1. Identify the parties

Make sure you clearly state the full legal names of all parties involved in the agreement. You should also include contact information and relevant business details, like an LLC name or address.

2. Define the scope of work or terms of the agreement

In the document, you need to outline the purpose of the contract in straightforward terms. For example, if you’re creating a freelance agreement, you should describe the services that will be provided as well as any expected deliverables and project deadlines.

3. Set payment terms

Spelling out exactly how and when payments will be made is key. You should include details like total amount, deposit requirements, payment schedule, and late fees.

4. Outline responsibilities and obligations

Each party needs to know what they are responsible for, so this should be clearly outlined in the document. For service contracts, for example, this could include any expectations around communication, quality standards, specific tasks, etc.

5. Include termination conditions

How and when can the contract be terminated? This needs to be clearly stated in the document as well. This could be anything from a breach of contract or a failure to meet obligations to a mutual agreement of termination.

6. Add key clauses

Beyond termination clauses, you can protect your interests (and the interests of the other party) by including these essential clauses:

  • Confidentiality: This will help to protect sensitive information involved in the partnership.
  • Dispute resolution: This should outline how disputes will be resolved if they occur, whether through mediation, arbitration, negotiation, etc.
  • Force majeure: This is what happens if unforeseen events prevent either party from fulfilling their obligations listed in the contract.

7. Use clear, simple language

Throughout the entire contract, it’s important to avoid legal jargon. Writing in plain, simple language will help all parties fully understand the terms instead of getting caught in the legalese.

8. Review and revise

Once you have a complete draft, check for errors or ambiguities. You can even ask a trusted colleague or professional to review the contract, even if you don’t end up hiring a lawyer. This will make sure everything is in order before getting to the final step.

9. Sign and store the contract

You did it! Now it’s time to have all parties sign and date the contract. While this can be done traditionally, eSignature is a great way to get fast, secure, and legally binding signatures.

You should also keep a digital copy in a secure location. The best way to do that? Use a document management software like PandaDoc. With our solution, you can create, send, sign, and manage contracts easily and all in one place.

When to use a contract template

A contract template can be extremely valuable when you need a starting point for simple agreements. Templates are a great way of providing structure to your document, making sure you don’t miss any critical clauses.

They’re especially helpful if you:

The best part about templates? You can customize them to reflect specific terms and details of your deal without having to start from scratch. But make sure you carefully review the needs of your agreement, as an unedited, generic template might fall short of your unique needs.

When you should consult a lawyer

As briefly mentioned earlier, there are situations where hiring a legal professional for advice is necessary. Here are a few scenarios in which you should consider reaching out to a lawyer:

  • The contract involves significant financial or legal risks.
  • There are complex or unusual terms (e.g., equity ownership or intellectual property rights).
  • You’re not sure if the contract complies with local, state, or federal laws.
  • You need help interpreting or negotiating terms from the other party.

Consulting a lawyer can be a good investment to avoid potential risk. It’s always better to pay for expert advice from the get-go than having to face expensive disputes later down the line.

Create fast, professional contracts with PandaDoc

Remember, you don’t have to start from scratch. Our extensive template library includes a vast variety of professionally designed contract templates so you can customize terms with ease. Our software has built-in eSignature functionality and workflow automation, making creating contracts easy and reliable. Plus, you can keep all your docs secure and organized in one place.

Still need convincing? Just ask our client, LiteZilla, who increased their average contract value by 30% while improving their close rate by 20% with PandaDoc.

“We were meticulous in our search for the right tool that would take our proposals to the next level, and PandaDoc delivered on every front. As a small business, PandaDoc has become an indispensable part of our workflow, demonstrating time and time again why it was the right choice for us.”

– Adam Greenspan, CEO at LiteZilla

With the right tool, you can create polished, professional contracts in minutes.

Ready to see PandaDoc in action? Request a free demo today.