GETTING OFFERS WHEN SELLING YOUR HOME
If all goes well, your Realtor will be presenting you with offers from buyers who want to purchase your home.
An offer is a contract. If you accept an offer, its terms are legally binding. Most elements of an offer are negotiable and it may take your Realtor several rounds of negotiation before you and the buyer reach a final agreement.
An offer to purchase includes:
- The purchase price
- A deposit. Typically it’s five percent of the sale price but is negotiable. In most cases, the deposit cheque is made out to the brokerage of the buyer’s Realtor. It is held in trust and becomes due after final subject removal. The deposit funds go toward the purchase price once the sale completes.
- Subjects. An offer can be clean and straightforward with no conditions. This is called a “subject-free”. If it’s accepted, the deposit is submitted and your home is sold.
- More typically, offers are written with conditions, or subjects, that must be satisfied before the sale can proceed. These can include subjects like your home passing an inspection, completing certain repairs and providing property-related documents for review.
- The buyer could also have subjects that need to be fulfilled, such as securing financing or selling their own home.
- If you agree to the conditions, the offer is accepted. You typically have seven to 10 days (or whatever is negotiated) to fulfill the conditions. The buyer will want to do an inspection to ensure the conditions have been fulfilled, as well as their due diligence.
- Once the subjects have been fulfilled, the buyer will give you written notice that they’re being removed and your house is sold!
- If for any reason, the subjects aren’t removed, your home is still on the market and you’re able to entertain other offers.
- Terms. These are the deal’s nuts and bolts like the price, dates, deposit, and items that are included as part of the sale.
- Adjustments. These are the pro-rated expenses associated with a property that will be assumed by the buyer, like property taxes, strata fees, and utilities.
- Closing Date (or Completion Date). This is when your home legally transfers to the buyer.
- Possession date. This is when your Realtor comes by to get your keys. Often it’s 30-90 days after the initial sales agreement and a day or two after the closing date.
- Expiry Date. This is when an offer to purchase expires.
After subjects are removed
Once subjects have been removed, the financial and legal process of completing the sale and transferring ownership begins.
You’ll want to get a lawyer or notary. Their job is to review and enforce all contracts, including the Agreement to Purchase and Title Transfer. This will give you peace of mind and ensure the sale goes through smoothly.
Remember that a lawyer/notary:
- Should be a licensed full-time lawyer/notary.
- Should be local and understand real estate laws, regulations and restrictions.
- Should have realistic and acceptable fees
- Can explain things in plain language.
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