Offer condition
- Thread starter cimbom
- Start date
Hello,
Is it generally acceptable to put a condition of "subject to our solicitor's satisfaction with the contract of sale" on an offer? That way, we don't need to waste time/money getting our lawyer to look at the contract if the vendor wouldn't accept the offer anyway.
Thanks
The thing is, you might need a solicitor to look at the condition to make sure it sticks.
Double whammy.
I'm saying best to get it worded correctly by a lawyer, but in doing that, you might as well have taken the entire contract to be reviewed by your lawyer in the same time.
Kind of defeats the purpose of the clause.
Unless your clause has been used before and you believe it's watertight.
How about if I include a specified timeframe, e.g. - "subject to our solicitor's satisfaction with the contract of sale, to be obtained within 3 business days of acceptance of this offer". That way, they don't think we're using it a way to get out of it if we change our mind or similar.
The aim is more to protect ourselves if there is something wrong in the contract. I think the vendor wouldn't bother chasing us as they could sell it to someone else. There seemed to be a decent amount of interest in it at the inspection today.
The aim is more to protect ourselves if there is something wrong in the contract. I think the vendor wouldn't bother chasing us as they could sell it to someone else. There seemed to be a decent amount of interest in it at the inspection today.
Why not just make a verbal offer, but not sign the contract.
I've never signed a contract the day I've made the offer. On each occasion I have bought a property I have verbally agreed on a price and then got my solicitor to look over the contract and include any conditions.
Exchange of contracts has never happened until I have had formal finance approval (including valuation) - usually a week or so after making the offer.
The agents are generally happy they have a buyer and dont put any extra effort into marketing the property - but im aware that someone else could come along before I exchanged and beat me to it. I've never had that done to me, however I have done that to someone else.
I've never signed a contract the day I've made the offer. On each occasion I have bought a property I have verbally agreed on a price and then got my solicitor to look over the contract and include any conditions.
Exchange of contracts has never happened until I have had formal finance approval (including valuation) - usually a week or so after making the offer.
The agents are generally happy they have a buyer and dont put any extra effort into marketing the property - but im aware that someone else could come along before I exchanged and beat me to it. I've never had that done to me, however I have done that to someone else.
I'd imagine the vendor would be wondering - what would constitute dissatisfaction on the conveyancer's part?
Is it a disagreement over a single clause, or what? It strikes me as very broad and vague.
Conveyancing isn't much - mine only charges $88 to look over the contract and advise accordingly.
Also, if there's a decent amount of interest, then any conditions make your offer less appealing....
Is it a disagreement over a single clause, or what? It strikes me as very broad and vague.
Conveyancing isn't much - mine only charges $88 to look over the contract and advise accordingly.
Also, if there's a decent amount of interest, then any conditions make your offer less appealing....
Spot on. You have this luxury in the ACT - there's a slight chance of losing the sale to someone who can go unconditional straight away but usually it's a verbal acceptance and then you exchange once finance has been approved and your satisfied with all the DD you've carried out.
Just need to keep it simple otherwise you'll scare off vendors.
Cheers
Jamie
It's a moot point in Vic. You get a 3 day cooling of period, during which you can get your solicitor to check the contract. You can exit the contract within that period at your discretion.
True, but that incurs a cost.
Better off wearing the solicitor cost upfront then risking 'cooling off' and incurring a much larger cost.
That risk makes more sense with a building inspection (where the cost of the inspection may be similar to cooling off anyway) IMO
Better off wearing the solicitor cost upfront then risking 'cooling off' and incurring a much larger cost.
That risk makes more sense with a building inspection (where the cost of the inspection may be similar to cooling off anyway) IMO
As Terry suggests, the condition is very vague.
Additionally the number of deals that don't proceed based on the cooling off period is quite small, especially when compared to the number of offers that people make that don't proceed.
So far this callendar year I've had 2 deals not proceed on the cooling off period across my entire client base. I've got no idea how many offers have been made, but the written offers that didn't proceed would easily exceed 200. That would amount to a lot of money spent on unrequired conveyancing ...
... and for what it's worth, neither of those non-proceeding deals had put down any cash at that point and thus weren't persued for the cancellation fee.
If I was the vendor I would ask you to put it in writing and then start negotiations if it wasn't accepting. Who says you are not just trying to screw me on price... After all if you want the property you would put it in writing and make it binding if I was to agree.
Offer to buy in less than 2 days?
Why not:
1. Produce the offer in writing (price and conditions you want) and email to real estate agent with any legal contracts and perhaps copy of PL insurance if trying to negotiate immediate access.
2. Offer negotiation and if accepted forward the contract to your property lawyer for review. I have agreement with the lawyers that they review for free but I will pay a fixed fee ($1600) and will use them if successful in buying process.
3. If happy with the review of contract: Exchange 'conditional' contract (a. satisfactory outcome in building & pest inspection, b. Unconditional finance approval, c.any special due diligence requests).
4. Organize building & pest and asbestos report if needed (determine costs for rectifying if any issues arise)
5. Now, after finance approval and inspection reports proceed to an 'unconditional contract'. At this stage, you are locked in to buy and cannot terminate without incurring heavy penalties.
6. On exchange of contract organize building insurance if renovation starts then perhaps "Construction all risk insurance OR Owner-builder insurance.
7. Project plan what you wish to do with the property (tradies, council approvals, fixtures, etc...)
8. Inspect 1-2 days prior to settlement to advice if OK. Then you become the owner and start to incur mortgage holding cost from this point if you have finance on it.
So you see anything is negotiable. If you are active and you have the right team with you they will do this for you. There are property lawyers that do check contracts upfront for free and have a fixed fee arrangements, but their fee may be higher when compared with solicitors fees.
IMHO, a good property lawyer would be worth the money as they can save you money and lots of hassles down the track... Good Luck!
I suppose it's up to who plays the game the best then can get the results first, right? I know the hard way when I dealt with RE agents in unprofessional ways and how I missed out on some deals.... Now I wish I made the offer in a formal way rather than just through words and mouth..
Example, rang agent, I asked questions, IP going to auction, agent wouldn't even state the asking price, wouldn't let me make an offer, he gave out 28 contracts so was I told, etc... said he had to go, didn't even want to pass me the contract, yes, really! I was willing to offer up to $670K. Guess, how much the property went for at auction? $640K and I was mad as my inexperience passed on the deal. I never went to see the property and never followed through - my mistake which I learned from!
So now, I use the strategy outlined above as IMO, I don't think even the agents can predict how much the property will go for, right? Imagine if I was the seller, I just missed out on extra $30K, so perhaps he was a good agent to deal with when buying but a bad agent to deal with when selling!
Why not:
1. Produce the offer in writing (price and conditions you want) and email to real estate agent with any legal contracts and perhaps copy of PL insurance if trying to negotiate immediate access.
2. Offer negotiation and if accepted forward the contract to your property lawyer for review. I have agreement with the lawyers that they review for free but I will pay a fixed fee ($1600) and will use them if successful in buying process.
3. If happy with the review of contract: Exchange 'conditional' contract (a. satisfactory outcome in building & pest inspection, b. Unconditional finance approval, c.any special due diligence requests).
4. Organize building & pest and asbestos report if needed (determine costs for rectifying if any issues arise)
5. Now, after finance approval and inspection reports proceed to an 'unconditional contract'. At this stage, you are locked in to buy and cannot terminate without incurring heavy penalties.
6. On exchange of contract organize building insurance if renovation starts then perhaps "Construction all risk insurance OR Owner-builder insurance.
7. Project plan what you wish to do with the property (tradies, council approvals, fixtures, etc...)
8. Inspect 1-2 days prior to settlement to advice if OK. Then you become the owner and start to incur mortgage holding cost from this point if you have finance on it.
So you see anything is negotiable. If you are active and you have the right team with you they will do this for you. There are property lawyers that do check contracts upfront for free and have a fixed fee arrangements, but their fee may be higher when compared with solicitors fees.
IMHO, a good property lawyer would be worth the money as they can save you money and lots of hassles down the track... Good Luck!
I suppose it's up to who plays the game the best then can get the results first, right? I know the hard way when I dealt with RE agents in unprofessional ways and how I missed out on some deals.... Now I wish I made the offer in a formal way rather than just through words and mouth..
Example, rang agent, I asked questions, IP going to auction, agent wouldn't even state the asking price, wouldn't let me make an offer, he gave out 28 contracts so was I told, etc... said he had to go, didn't even want to pass me the contract, yes, really! I was willing to offer up to $670K. Guess, how much the property went for at auction? $640K and I was mad as my inexperience passed on the deal. I never went to see the property and never followed through - my mistake which I learned from!
So now, I use the strategy outlined above as IMO, I don't think even the agents can predict how much the property will go for, right? Imagine if I was the seller, I just missed out on extra $30K, so perhaps he was a good agent to deal with when buying but a bad agent to deal with when selling!
Hello,
Is it generally acceptable to put a condition of "subject to our solicitor's satisfaction with the contract of sale" on an offer? That way, we don't need to waste time/money getting our lawyer to look at the contract if the vendor wouldn't accept the offer anyway.
Thanks
What exactly would you like your solicitor to review....the contract wording (is it a standard form)?
The conditions/terms (if any)?
The price (is a solicitor the right person for this)?
