What are the usual conditions that are placed on an offer?
As a home seller it is a good idea to educate yourself about the key components of a real estate contract of purchase and sale. Of particular importance to you, when deciding on whether or not to accept an offer, are the contingencies or the ‘subject to’s’ that the buyer has attached to the offer.
The offer will stipulate a certain amount of time (usually 1-2 weeks) in which the parties have to remove or waive these contingencies. During this time period, the buyer will be working hard to meet or remove the various subjects. If the buyer is unable to meet or remove a contingency, you can either collapse the offer or renegotiate around the issue.
If the buyer’s conditions are met in the specified time, your offer goes unconditional – which means they’re legally bound to buy the house. This is the point when the SOLD sign goes up. If the conditions aren’t met by the agreed upon date, the deal will most likely collapse.
Types of Contingencies
Some contingencies are quite common. The usual five that we see on an offer are:
1 Subject to finance
2 Subject to inspection
3 Subject to review of the Title
4 Subject to reviewing the property disclosure statement
5 Subject to insurance.
If you are selling a strata property or a mobile home or bare land or if your property has a septic system or a well then you can expect to see additional contingencies added to the offer.