Most offers that you will receive when selling your home will be conditional offers. These are offers that depend upon certain circumstances being met to complete the requirements of the sale. The conditions of these offers will vary so it will often pay to have your solicitor look over the conditions and explain the ramifications of these for you to understand.
COMMON CONDITIONS ON THE SALE OF THE PROPERTY INCLUDE:
Finance – buyers will often make an offer on a property that is conditional upon obtaining finance for the property.
Inspections – An offer may be made on the basis that expert reports, such as pest and building inspections and title reports come back clean.
Sale of another property – Homeowners may be awaiting the sale of their own property in order to finance the purchase of a second property. They may make an offer on the basis of their property being close to settlement or sale, but require that the sale be delayed until their sale is complete.
As a seller you are within your rights to negotiate these conditions and you are under no obligation to accept the terms if you believe they are unreasonable or will cause you any hardship in the sale of your property. You may also set time restraints on the meeting of conditions, whereby the contract is invalidated if the requirements are not met within the timeframe.
If the conditions are met, the buyer is not able to rescind their offer and must meet the conditions of sale on their part. It is therefore imperative that both parties have a full understanding of their legal obligations when the contract is established.
It is important for each party to weigh up the likelihood of the sale going through based on the requirements on each party.
This is where the difference between conditional and unconditional offers matters. The requirements laid down in the contract and greatly impact the resulting deal, so get it right the first time.
WHAT IS AN UNCONDITIONAL OFFER?
Most auction offers are considered unconditional, excepting circumstances where the buyer has previously negotiated with the seller.
An unconditional offer is an offer that is made without any of the above conditions, the buyer is prepared to purchase the property on acceptance of the offer. Unconditional offers outside of auction are a more attractive prospect for a seller as the buyer is less likely to pull out and therefore buyers will often have a time period in which the offer is valid.