What is a Offer to Purchase and Why You Need It?

The offer to purchase is a very important piece of document that one must not take for granted. It contains all the terms and conditions for the purchase and sale of your property in which both the buyer and the seller agree upon. And once both parties have signed the document then the agreement becomes binding. This piece of paper also allows for a quick and clean transaction and allows a party to file a law suit against you if it so happens that an agreement was violated. In real estate it is quite common to give out offers and counter offers until both parties come to a consensus. And to help you with your purchase offer here are 5 tips to nudge you in the right direction.

Condition of Sale

A condition of sale can suspend the transaction until they are met. A common example of this condition would be waiting for the approval of your bank for the home loan.

Fixture and Fittings

You need to indicate in the offer to purchase which fixtures and fittings are going to stay and which are the ones you want removed.

Deposits

Most transactions require a sign of good faith via a deposit. The amount should be stated on the offer to purchase and the deposit held in a trust account which is interest bearing. It will be held there until transfer. One must also state in the agreement that the buyer, which is you, must receive the interest earned once the deposit is released.

Voetstoots

Normally a property is usually sold “voetstoots”. This means that if you buy the house then any defects or faults found will also be included and need not fixed by the seller. If you do want them fixed or renovated then you must have it listed at length on the agreement.

State Possession concisely

This is one of the biggest headaches when it comes to real estate transactions. And two reasons constitute to this headache. The first one is that it was never clearly stated in the agreement. And the second one would involve the both parties having contradictory anticipation on possession.

Always indicate the possession date. It doesn’t really matter if it’s on the closing date itself or a day or two before the closing. The important thing is that you have to state it clearly. Although, if you do decide to set it before closing then you may want to implement a rental agreement for both parties sake. The same goes if the possession date is set a day or two after closing. This ensures the buyer is protected.

Important things you need to remember

You must always take the time to read the agreement as thoroughly as possible. Remember, once it’s signed you are legally bound to the terms and conditions on the document. It is always a good idea to consult someone, like the bank or a realtor agent, when it comes to certain lines or statements in the document that you don’t fully understand. And never ever consult the seller if you’re in doubt.

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