Offers are simply proposals for the exchange of real estate.
They are like the buyer and seller’s questions to one another in a legal conversation where the ultimate goal is to get the other person to give you a plain and definitive “yes!” The first offer begins this legal conversation of how the real estate transaction is going to play out. Once an offer is accepted, it becomes a legally binding contract. The process starts with a buyer extending an offer to a buyer. When the seller gets that offer, they have three options: make an offer back (counteroffer), reject the offer (end the conversation altogether), or accept the offer (making it a legally binding agreement). In order for a seller to accept an offer, they must do so unconditionally, meaning they have to accept the offer exactly as it is presented. If the seller wants to make any slightest change to the offer, they must do so in the form of a counteroffer. For example, if the seller is happy with everything about the offer, but wants $550,000 instead of the buyer’s proposed $540,000, then the seller would need to make a counteroffer saying just that. Each party is always free to walk away from a counteroffer. Like most contracts, when a party accepts an offer, it becomes legally binding upon the other party’s notice of the acceptance. So, if the buyer accepts the seller’s counteroffer of $550,000, that offer becomes legally binding when the seller receives notice of the acceptance.
Offers blueprint the transaction by including:
Listing Information: The sales price, address of the property, and sometimes legal description.
Financial Information: Whether the sale will be completed with cash or through a mortgage, amount of the earnest money deposit, and how the earnest money deposit will be returned if no agreement is reached. Not to be confused with the down payment or deposit, the earnest money deposit is a sum of money that accompanies the offer to show the buyer that you’re serious. If your offer gets accepted, this becomes part of your down payment.
Seller’s Promise: The promise to provide a clean and free title, also what type of deed will be provided.
Party Responsibilities: Who will be responsible for costs associated with title insurance, survey, title, and inspections.
Prorations: Calculation of how taxes, utilities, and rents will be prorated. These calculations will specify how much the seller and buyer are responsible for/entitled to taxes and utilities and rent based on closing date.
State Specific Clauses: Requirements specific to the state in which the sale is taking place. For example, disclosure of specific environmental hazards.
Walkthrough Provision: Stating that the buyer is entitled to a final walk-through of the property right before the closing.
Time Limit: after which offer will become null.
Case Specific Contingencies: Offers are often contingent upon the buyer’s ability to secure a loan and the results of a home inspection. An offer could also be contingent on something like the seller leaving all furniture.
That seems easy enough, right? Maybe not, but working with a Casandra Properties, Inc. Real Estate Agent makes this process more seamless!
For more information contact our office 718.816.7799 or by email email@example.com.