A player in basketball whose contract has expired or been terminated by his current team in compliance with NBA waiver procedures. Also, a player who qualified for the NBA draft but was never signed to a contract.
The most common type of free agency occurs when a current player reaches the end of a specified contract. That player, depending on the term of his contract, then becomes an unrestricted or restricted free agent. The difference between restricted and unrestricted is that the player's original team has "right of refusal", meaning that if the player intends to sign with another team, the original team can attempt to retain the player by committing to a certain percentage amount greater than the player's former salary or any amount under their cap. The maximum amount percentages free agents can sign for are determined by the collective bargaining agreement and any other league rules applying to free agency.
Free agency typically tends to favor the team to which the player originally belonged, allowing them to retain some of their privilege from drafting the player. Other teams can sometimes avoid missing out on acquiring a free agent by utilizing a mid-level exception (each team is granted one mid-level exception per season for a specific maximum amount) or engaging in a "sign and trade."