A real estate purchase offer is a binding contract that outlines the specifics of a home purchase. Before the seller accepts or denies the contract, it's important for the seller to understand the contract and its terms. If you're currently selling a home, or if you're thinking about listing your home for sale, here's what you need to know about the home purchase contract.
Firm Versus Conditional Offers
A firm offer is an offer to purchase a home as-is. Once the offer is signed, it's binding. If the buyer cancels the contract without purchasing the home, the buyer may lose the deposit.
The other type of offer that a buyer may make is called a "conditional" offer. Conditional offers are contingent upon certain conditions being met before the purchase can go through. If the contract is signed by both parties and all of the conditions are met, then the buyer is obligated to purchase the home, or they may lose the deposit.
The Anatomy of an Offer
Although the details of a home purchase offer will differ from one offer to another, most purchase offers have elements in common. Knowing what to look for in the purchase offer can help the seller analyze the offer.
The purchase price is what many home sellers naturally want to look at first. Whether the purchase offer is more than, less than or equal to the listing price will depend on a variety of factors including the desirability of the area, how motivated the buyer is and how much competition there is for that particular house.
Sellers who do not get the offer that they're looking for may counter the offer, accept or reject the offer. At this stage, it's important for the seller to work with an experienced real estate agent. A good real estate agent can help the seller decide whether or not an offer is a good one and if not, how to proceed.
Conditions, also known as "contingencies," may vary. Often, buyers will make the offer conditional upon the completion of a home inspection. This condition usually includes language that allows the buyer to back out of the contract if the home inspection reveals certain problems with the property. Buyers may also request certain repairs to be made, or may make the offer contingent upon the sale of their current home.
Requisition Date and Closing Date
The requisition date is the date by which the buyer must have the title inspection completed, in addition to any other searches that must be performed by the buyer's lawyer. The closing date is the day that the home changes ownership from the seller to the buyer. The seller must be moved out by the closing date.
The Southeast Calgary home purchase offer may also include miscellaneous information, such as whether or not furniture and appliances will be included with the sale of the house.
Examining the Offer
When an offer arrives, it's important for the seller to go over all aspects of the contract with an expert. This is when it's helpful to have an experienced real estate agent helping with the sale. A good real estate agent can provide feedback, give suggestions and can help the seller craft a counter offer.
If you're a homeowner who would like to sell your house sometime soon, contact an experienced real estate agent in your area. Your real estate professional can help you throughout the sale process.