Accepting a Purchase Offer - Counter-offering - Contingencies

Whether or not to accept an offer may depend upon several things contingent upon your own personal needs and the current real estate market. In a "Seller's Market", you may have several offers for purchase and you may have the luxury of choosing which contract to accept. Offers may include a "Cash Offer" which may be more acceptable to one in which contingencies are included.

A contingency found in an offer to purchase real estate is when the Buyer says the purchase is "subject to" something happening (or not happening). For example, a common contingency is that the purchase is subject to the Buyer being able to obtain financing. If the Buyer doesn’t qualify for the mortgage, the deal is null and void. Common contingencies are:

• Financing contingency (Buyer must obtain needed financing for the property).
• Professional home inspection contingency (Buyer must approve a home inspection report)
• Termite clearance (Seller must provide a termite clearance).
• Disclosure contingency (Buyer must approve seller’s disclosure).
• Other contingencies specific to this deal such as the Buyer being able to sell his or her current home.

It is important to review each offer carefully and you may want an attorney or a licensed real estate agent to review the offer prior to accepting. The more contingencies in the offer, normally the weaker it is. If you are "fully-listed" with a traditional real estate agent, it is common that this agreement may trigger a requirement that you pay the agent a commission even if you do not accept a full price offer. Be aware of the requirements of the listing agreement should you use the services of an agent when rejecting purchase offers.

Whether or not to provide a counter-offer is also dependent upon your personal needs to sell. If you are willing to risk losing a Buyer who has made an unacceptable first offer, then it may be appropriate for you to counter-offer or reject the offer.