A purchase offer is a legally binding agreement between a buyer and a seller that outlines the terms and conditions of a proposed transaction that must not be lightly taken. Whether you’re buying a home, a car, or any other high-value item, understanding the ins and outs of a purchase offer is crucial to protect yourself and ensure a successful transaction.
Having said that, in this article, we will explore some important things to know about purchase offers, including what they are, how they work, and what to look out for when entering one.
What Is a Purchase Offer?
Also known as a purchase agreement, a purchase offer is a contract and a legal document made and agreed upon by both the seller and the buyer. It contains specific terms and conditions surrounding the transaction, including the purchase price, sales terms and conditions, payment terms, and other legal aspects that come with selling a real estate property.
Understanding the Details of a Purchase Offer
A purchase offer is not a simple document—but is essentially a legally binding contract—that describes and outlines the purchase transaction. It is why it must not be taken lightly and must be reviewed and assessed thoroughly before you sign one. And failure to do so may lead to legal complications, and financial implications, and may also put your reputation at risk.
That said, what does a purchase agreement contain? Here are a few important details you should understand as both the property owner and seller.
- Purchase price. Also known as the sales price, it is the exact amount of money the buyer offers to buy the property being sold.
- Payment terms. It is a list of payment methods such as cash, financing, and check. It also includes the timeline the buyer proposed to pay the house, specifically if it is through a bank loan.
- Contingencies. It is a condition or a list of conditions that must be completed first. Otherwise, the sale would not go through. A few examples are approved financing assistance and property inspection.
- Property goods or descriptions. As the term suggests, it is a detailed description of the house or property that is being sold. The seller must disclose all important information about the property, including defects and limitations.
- Closing date. It is the date on which the sale is expected to be finalized and ownership transferred.
- Signature. One of the most important details in any contract, the signature indicates their agreement to the terms and conditions of the purchase offer.
Things to Keep an Eye On
Aside from carefully understanding the details of a purchase, it is also critical to keep an eye on some important—but often missed—aspects to protect your property as well as your rights as the owner and seller.
That said, below are some things to consider in terms of purchase before you sell your home.
- Full disclosure of the property’s condition. Owners are required to disclose all information concerning the house’s overall condition. And failure to do so may lead to legal consequences that will certainly cost you money and time.
As such, it is important to thoroughly conduct a property inspection. It is also best to hire a professional home inspector for this job rather than doing it yourself.
- Unclear terms. Whether it is in personal relationships or business transactions, anything unclear is a red flag! Hence, make sure all terms and conditions outlined in the contract are clearly stated and explained.
Always remember that ambiguous terms and conditions can lead to misunderstandings and disputes down the line. Thus, it is best to address it as soon as possible.
- Contingencies. While contingencies can help protect your interests, they can also create delays and complications in the sale. Be sure to carefully consider any contingencies and negotiate them with the other party if necessary.
- Financing. Finally, if the buyer is proposing to buy your house through financing assistance such as a bank loan, make sure to carefully review the terms and conditions included in the loan agreement.
Is It Possible to Cancel It?
It is possible, but rare. A legal contract that is signed by both parties is irrevocable. And if one of them has failed to uphold any of the conditions written in the purchase agreement, the other party can sue them for breach of contract.
Thus, it is critical to thoroughly review and carefully assess the details of a purchase offer before signing it.
Here are the legally approved exceptions once can file to cancel the agreement.
- Counter-offer. An offer proposed by the seller if the buyer’s proposed price is not close to his/her desired sale price.
- Void offer. It is when the seller rejects the offer.
- Buying a new home from a builder or developer. Buyer may cancel a signed purchase agreement if the property was bought from a developer or a builder. Although it can only be done within 10 days after the contract was signed.
The seller may require a 0.5% of the selling price as well as a compensation.
The Importance of Purchase Offer
Selling your property is indeed a tough and overwhelming process. You need to understand several legal and business terms to successfully complete the sale. Otherwise, the chance of getting into a legal dispute and misunderstandings is high.
On the other hand, if you want a fast, hassle-free, and reliable way to earn money from your property, then contact Get Your Fair Offer now and consider your house sold!
Get Your Fair Offer is one of Houston’s trustworthy real estate investors. We guarantee to give you the best and fair price offer only, which your property deserves.
Reach out to us now and get a REAL offer! Call us at 281-709-2999.