When buyers and sellers strike a deal, loose ends often need tidying up before the buyer will proceed. Typical examples: financing, a home inspection, and selling the buyer’s home.
When that’s the case, a conditional offer should be signed one made “Subject To” these conditions.
If the buyer satisfies them within the allotted time, the offer becomes “Firm And Binding”. If not, the deal is off, and the buyer gets the deposit back.
- As a buyer, make sure you understand how to keep the contract alive or kill the deal.
- As a seller, if you face a lengthy period of legal limbo with an outstanding condition, add an escape clause to the offer.
If another acceptable offer is presented, it’s decision time for the firs buyer-waive the condition and close the sale or lose the deal. Buyers, remember: conditional offers give you flexibility, but unconditional offers always get a better reception with sellers.