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The Offer Process

Buying a home is the largest purchase most people will ever
make, and it's not quite like other transactions. A contract
binds the buyer and the seller into a legal agreement to do
certain things, and offers protection for each side in the
form of conditions that have to be met. When all the
conditions are fulfilled money and ownership change hands.

Scroll down to read more information about the offer to
purchase, as well as some notes on common conditions
like financing, inspection, or the sale of the
purchaser's property.

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The Process, Step-by-Step

The Offer Process

When you come across the home or property that’s right for you then the next step is to put in an offer. At this point your REALTOR® will discuss with you the best way to do this based on your situation and what fair market value for the home you’d like to buy is.

Typically offers will go back and forth a few times between the buyers and the sellers as you try to agree on price and terms. When an offer goes back and forth like this it is referred to as being in ‘signback’. Any changes from the original offer will be documented in writing, although in extenuating circumstances negotiations will continue verbally until they can be documented in writing. This is where your REALTORS® negotiation skills and experience really go to work for you!

The Deposit

The deposit is usually delivered to the listing brokerage upon acceptance of the offer. The deposit will be held in trust until closing and then applied to your purchase price. For example if the purchase price is $210,000 and the deposit is $5,000 then $205,000 will be owed at closing.

The Conditional Period

Once your offer is accepted the conditional period begins. All of the conditions in your offer must be met before it can become firm and the deal finalized. Most offers contain the following conditions:

  • Finance–Mortgage approval for the purchase will need to be obtained to meet this condition. We would be happy to recommend an experienced mortgage specialist.
  • Appraisals – Sometimes mortgage providers will order an appraisal on the home to make sure that the home is worth what they are lending you to purchase it. If an appraisal is required it will be scheduled by your mortgage provider.
  • Inspection – A professional home inspector will thoroughly check the home and let you know if there is anything you should be concerned about. We can recommend an experienced home inspector for you.
  • Insurance – If you are obtaining a mortgage, you will be required by your lender to purchase insurance on the property. You may be able to save money on homeowners insurance by shopping around for insurance.

And sometimes:

  • Sale of Purchasers Property or SPP – If you are purchasing a property and still need to sell your current property you might make this condition part of your offer. Your agent will guide you on whether to include this condition in your offer or not.

When all of the conditions have been met and the appropriate paperwork is signed and submitted the offer is considered firm.

A Firm Offer

Now that all of the conditions have been met your offer is firm, congratulations you just bought a new home! All that’s left to do is to get ready to move in on closing day.