HOW DOES A SALE OF BUYER’S PROPERTY CONDITION WORK?
Not many of us can afford – or want – to carry two mortgages. So what do you do if you’ve found your dream home but need to sell your home before you can buy it?
Your Realtor can help you submit an offer to purchase with the condition that you must sell your own home before you can complete the purchase (known as a Special Clause Offer or a Sale of Buyer’s Property Condition). This way you’re not locked into completing the sale if your home doesn’t sell.
Your offer to purchase will include a Sale of Buyer’s Property Schedule, outlining your property details and asking price. You and the seller will also need to agree on a reasonable time frame for you to waive your conditions if the seller accepts an additional offer. This gives you the “first right of refusal” in the case of a second offer.
Although your offer is legally binding, the listing will remain active on the MLS® system until the conditions are waived and the seller’s agent will continue to market the home to potential buyers.
If the seller accepts another offer, you will receive a written Notice (AREA’s Notice for seller’s notice/buyer’s notice under Sale of Buyer’s Property Schedule) and have until the agreed upon timeframe (usually 24 or 48 hours) to waive your conditions. If you’re unable to waive conditions or fail to give the seller notice within the specified timeframe, the seller can accept the new offer and your offer will collapse.
I’ve submitted my offer. Now what?
It’s important to know the seller may accept another offer at any time. Your Realtor will guide you throughout the process but understand that you may need to be open to aggressive pricing and marketing strategies to encourage a quick sale, especially in a seller’s market.
Your offer to purchase will be open until the agreed upon Condition Day outlined in your contract – upon which you will need to waive or satisfy your Sale of Buyer’s Property condition or the contract will end.
Why wasn’t my offer accepted?
While some sellers will find comfort in having an offer and a potential buyer “locked in”, other sellers may be afraid that having a competing offer will discourage other potential buyers (ones that can buy right away), especially in a buyer’s market when inventory is high.
What happens once I accept an offer on my home?
Your home will be considered sold when you have a legally binding purchase contract where all conditions have been satisfied or waived. Then your Realtor will help you give written Notice to the seller that you have satisfied your Sale of Buyer’s Property condition. Your offer to purchase will be enforceable and legally binding – start getting ready to move into your new home!
Written by CIR REALTY