by Admin Staff
on Monday, December 14th, 2020 at 3:50pm.
The purchase of a home isn't at all like buying a chocolate bar from a convenience store, or even like buying a large piece of furniture. There's legalities to consider, items to move, systems to check and so on. To make sure all of these things are taken care of, there's a process. You know, the home buying process and the home selling process we so often talk about. An important initial part of the process for both buying and selling is the Offer to Purchase, or Buyer's Offer if your prefer. So, regardless if you find yourself on the selling side of things, familiarizing yourself with the Offer to Purchase will be a beneficial step that'll help you and your Realtor negotiate and refine when the time comes to get back to the buyer. Here are the major elements of an offer:
Depends on the market and the buyer, but generally, the price offered for sellers is different from the asking price. For the buyer, Offering too little can increase your chances of losing the home to another bidder. And offering too much..well, nobody wants to pay more for something than that something is worth.
The deposit shows the buyer's good faith and will be applied against the purchase price of the home when the sale closes. Your CENTURY 21 Realtor will advise you on the suitability of the amount of the deposit being offered. It's important to note that this is NOT the same thing as a down payment. It's easy to think of this deposit like a security deposit when you rent. A security deposit shows you’re serious about renting the unit, and you’ll get the money back as long as you treat the apartment well and meet all the conditions of your lease. A deposit on an Offer to Purchase works in a similar way. Like the landlord, you want the seller to know you’re serious. But unlike the deposit you make on a rental unit, you’re not going to get it back. Instead, it goes toward your down payment. As the successful bidder on a property, the buyer's deposit will be held in trust by the real estate brokerage of the seller’s agent.
The terms in an Offer to Purchase include the total price the buyer is offering, as well as the financing details. The buyer may be arranging their own financing or may ask to assume your existing mortgage if you have an attractive rate.
Conditions might include, but are not limited, to: subject to home inspection, subject to buyer obtaining financing or subject to the sale of the purchaser's property. Conditions for a home sale means that the house will not be sold until all of the conditions have been met.
Inclusions & Exclusions
These might include appliances and certain fixtures or decorative items, such as window coverings or mirrors. The offer may specify that these items are to be included or excluded, which means the offer is contingent on these inclusions and/or exclusions.
Closing or Possession Date
In Saskatchewan, this is the day the title of the property is legally transferred to the new owner(s) and the transaction of funds finalizes. In other provinces, this date is varied.
Once all of these elements have been poured over, agreed upon and signed, the next parts of the process can begin!