Are you wanting to buy a new home but trying to understand the offer process is making you feel bugged eyed? Well, grab your notepad and pen because in this blog we are going to give the offer process, so that you can be confident in buying your first home.
Before the Offer
Before a good real estate agent can write up an offer, they will need the following from you:
- How much you are willing to offer, which is considered the purchase price
- How much deposit you will be providing and when. If you didn’t see our video on deposits vs down payment, I recommend you to check it out first then come back to this video
- The closing date. The date you want to take ownership of the property
- If there are any conditions that need to be added, such as an inspection condition.
- Any extra items that want to be included in the purchase (ex. Window coverings)
- The date the offer expires, also called the irrevocable offer date and time
After all the buyers have signed the APS, we, your realtor, would sign our section and submit it to the listing agent.
The listing agent would book an appointment to meet with their client and provide the information we provide.
Once the offer is submitted, the ball is in the seller’s court until the irrevocable time. After the irrevocable time, the offer is no longer valid.
Irrevocable Time
Before the irrevocable time, the seller has 3 options
Accept the offer – by signing all the necessary areas on the APS. And we now have an agreement.
Reject the offer – the seller doesn’t agree with the offer and turns it down. The offer is now considered dead.
Countering An Offer
Counter – this is when the seller sends back the offer with some changes to the agreement. Maybe they doesn’t like the closing date, or the purchase price. The seller would cross off what they don’t like and replace it with what they are offering. The seller would also change the irrevocable offer time, putting the ball back in your court.
Depending on the market, countering an offer can go back and forth between the seller and buyer many times…kinda like a tennis game, until there is an agreement or one party chooses to walk away.
This tactic is not to be used at all times, it’s important to understand what kind of market you are in. In a sellers market, the seller may have many offers to look at, so instead of doing a counter offer, they may just go with another offer that is giving them what they are looking for.
Once An Agreement Is Made
Once an agreement has been reached, both parties will receive a copy of the APS and sign that they have received it and the buyer will provide the deposit within 24 hours of the signed agreement, unless of course the deposit is provided at the time of the offer.
If there are conditions that need to be fulfilled, the sale is considered conditionally sold. Based on the agreement, you will have time to fulfill any outstanding conditions, whether it is for a financing condition, or a home inspection condition.
If there are no conditions or all the conditions have been fulfilled, and the deposit has been paid, the agreement is firm! Woohoo, you now own the home!!!
Deposit vs Downpayment
Now that you know why you should buy now rather than wait you may also be interested in learning about deposits vs down payment.
In this blog, you will learn what is the difference between deposits and down payments, when they are required and how much you need.
If you are considering buying a house but not sure if this is the right time, book an appointment with us and we can go over your options.
