What is an offer to purchase, and when does it happen?

December 18, 2014

If it’s your first time buying property, how it works can be confusing. Here’s what you should know about an offer to purchase, and what happens during the home-buying process.

What is an offer to purchase, and when does it happen?

What happens before you make an offer?

The short answer is that every situation is different. But in general, you will have seen the property and have made the decision that you want to buy it — and at what price. Once those things are clear, you would prepare an offer to purchase the house, condo, townhouse or whatever property it is that you are interested in.

What is an offer to purchase?

An offer to purchase is essential a legally binding document that indicates that you want to buy a certain property based on the terms outlined in the document. The information that is generally included in an offer is: your name, your co-buyer’s name (if applicable), and vendor’s name and both parties’ separate addresses; the price you are prepared to pay; anything you want to be included with the house (such as appliances or window coverings); the amount of your deposit; the date your offer expires (these offers are never left open for indefinite periods of time); and any other conditions you need met (such as a home inspection, which is always a good idea).

Get help preparing your offer to purchase

Most people prepare offers to purchase with the help of a real estate agent but it is possible to do it on your own. Though it can be confusing and sometimes complicated. Some people also choose to involve a lawyer and/or notary when preparing an offer to purchase. Because an offer to purchase is a legally binding document, it’s not something you should take lightly. If your offer is accepted, you will be required to follow through with all the items you included in the document, so be sure to get everything in there that you want.

The most important thing to remember when preparing an agreement to purchase is to make sure you get it right the first time, because if your offer is accepted, you are responsible for following through on the terms of your offer.

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