A contract is generally a written or spoken agreement between persons or entities that includes obligations for each party (mutual obligations or mutuality) and enough specific information to be enforceable by either party (specificity).

The elements of forming an enforceable contract are generally (1) an offer made; (2) acceptance of the offer; and (3) consideration given by each party for the other party’s performance of the agreement—such as money in exchange for products or services, or mutual promises exchanged—which is often referred to as the bargained-for exchange.

The word "agreement" is often used interchangeably with the word "contract," and a document labeled as an agreement (with the necessary legal elements included) is as enforceable as a document labeled as a contract.

In New Mexico, as in other states, a contract is a legally binding agreement between parties that creates mutual obligations. The essential elements required to form an enforceable contract in New Mexico include (1) an offer, (2) acceptance of that offer, and (3) consideration, which refers to the value exchanged between the parties, such as money, services, or mutual promises. The contract must also have sufficient specificity, meaning it must contain enough detail to determine what each party is obliged to do. If these elements are present, the agreement, whether oral or written, can be enforced by law. The terms 'agreement' and 'contract' are often used interchangeably, and the enforceability of the document does not depend on it being labeled as one or the other, but rather on the presence of the necessary legal elements. It is important to note that certain types of contracts in New Mexico, such as those related to real estate transactions, must be in writing to be enforceable due to the statute of frauds.