|
 What
Are Conditional
Offers?
Diane Kelly - Talk Calgary - Real Estate Info
A Conditional Offer Can Make It
Happen
A conditional offer can often be the best way to buy or sell a home
for the terms most favorable to you. However, there can be a down
side, so know your facts before you decide whether a conditional offer
can work for you.
When reviewing the conditional offer with our
clients I can point out the conditions, and also explain how
they will impact the potential sale. Some conditions may be simple or
short-term, such as requiring a home inspection or approval of
financing. Such conditions are commonplace, and they shouldn't tie up
a property for long. Therefore, these conditions usually don't have a
major impact on the negotiating process.
However, if the offer is conditional upon the
sale of the buyer's existing property, that's another story. Sellers
should expect that this condition will likely be in effect for a
relatively long period, and there's also a very real chance that
the condition may never be fulfilled. This condition benefits the
buyer by holding your house at an agreed upon price and terms, for a
specified period of time. If at any time during that period, the buyer
either fulfills the condition by selling their home, or chooses to
remove the condition, then the offer becomes firm and the transaction
proceeds. If this doesn't happen and the conditional offer expires,
then the buyer is under no further obligation. They may come back to
negotiate a new offer, at terms that may be less favourable to you, or
they may not come back at all.
While a conditional offer is in place on your
property, the seller is still free to continue marketing their
property to other prospective buyers. This keeps the heat on the buyer
to fulfill their condition in the shortest possible time. The seller
can't accept another conditional offer while one is in force. However,
if there's an "escape clause" in the agreement, you will
still be able to accept a firm offer provided you give the conditional
buyer the option of "firming up" their offer first. If your
conditional buyer does "firm up" their offer, they are in
simply removing their conditions. The original selling price and terms
of their offer stay in effect, regardless of what you may have been
offered by another party.
Sellers should be aware that some sales
representatives might be less likely to show your property if a
conditional offer is in place. They may be reluctant to get buyers
excited about a property that someone else has "first call"
on. Above all remember conditional offers can have a big effect on you
whether you're a buyer or a seller.
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Calgary Real Estate consultant Diane Kelly, Discover Real Estate Ltd,
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