Purchase & Sale Offers


All the decisions have been made. The house has been prepared like a model. Advertising and marketing has begun. The listing is in the MLS and the showings are in full swing. Now it is time for the reason that all the work has been done: an offer.

An offer in Real Estate is a bit different than it is in many businesses. If a buyer asks a shopkeeper "could I buy this for $10?" and the shopkeeper accepts the offer, the buyer can still change their mind and walk away. Not so when you are dealing in Real Estate. When a buyer makes an offer, it is in the form of a legal contract. If you, as the seller, accept the offer, the house is sold. If you counter-offer, negotiations may continue. It is important to understand that all of the offer and counter-offer activity that you will engage in is framed legally.

This is why it is so important that a seller never gets involved in oral offers and negotiation. If you have a house listed at $380,000 and the buyer asks "would you sell the house for $365,000?" almost any response you make--short of "put it in writing"--can cause problems. If you verbally accept the offer, not only does the buyer have no obligation to actually buy the house, many will say to themselves, "gee, that was easy....I wonder if $350,000 would work?" This is why an Agent will never deal in verbal offers. If you are selling on your own, it is very good advice!

Some important points regarding purchase offers
  • If you intend to accept an offer (or make a counter-offer), do it as soon as possible. At any time prior to your acceptance or counter-offer, a buyer can withdraw their offer.
  • Any changes made on the contract require written approval of all parties for the contract to be enforcable. Even seemingly minor changes open the door for either the seller or buyer to change their mind.

What about low offers?

No matter how well you have prepared your house and how certain you are that it is priced at fair market value, there is always the possibility of receiving a low offer. It could be simply a shot in the dark, or it could be due to a limit in the buyer's mortgage qualification ability. No matter what the case is, though, the most important thing to remember is do not take it personally. Many home negotiations, if they had just been allowed to run their course, very well may have come together acceptably for all concerned if the negotiations hadn't fallen into a "grudge match". Yes, it is your home, and yes, you have put a great deal of love and effort into it, but taking a low offer as a personal affront solves no purpose. Reject the offer or counter-offer it and move on.

If you do get a low offer, it is far more important to try to get as much information as you can relative to the offer. Why was it at the price that it was? What was the motivation of the offer? (Be aware, though, that if the offer has come from a Buyer's Agent, the information you receive will only be as much as the Buyer's Agent wants you to know. They owe their loyalty to the buyer and cannot disclose any information that may put their client at a disadvantage.) There still may be information that will be revealed to you, which will help you as you structure a counter-offer.


P & S Contracts

Becoming familiar with the components of a contract before you have one presented to you puts you in a better position when it comes time to negotiate one.

What are the Components of a Real Estate Contract?

Although there will be some variance based on the location of your residence, most Real Estate contracts contain most or all of the following items:

  • What: A legal description of the property as well as the street address.
  • How Much: The selling price.
  • Mortgage Contingency: Subject to obtaining a mortgage (if applicable) and the specifics of the mortgage--amount, rate and term. Application to be made in X number of days.
  • Deposit: How much money accompanies the contract and who will hold it.
  • Closing: When and where
  • Inclusions & Exclusions: What is and is not included in the sale of the property.
  • Home Inspection: Contingency for and to be done in X number of days.
  • Warrenties: Any that are included with the house and description of the warranty.
  • Condominium: If the property is a condo, other provisions will apply.
  • Well & Septic: If applicable, they must be tested (and pass).
  • Termite & Pest Inspection: Who will pay and if there is infestation or damage, who will repair.
  • Possession Date: When the buyers take possession of the house--before, at or after closing.
  • Acceptance: How long the sellers have to respond to the offer with either acceptance or a counter-offer.
  • Arbitration: Any provisions for arbitration of disputes.
  • Insurance: Whose insurance covers the property up until the closing date.
  • Property Disclosures: Notices of any property disclosures concerning the house





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