Hi all,
I’ve come accross something that I wasn’t expecting and I was wondering if I might be able to seek your opinion on the matter.
Two days ago we put in a written offer on a property with a local real estate agent (shall remain nameless).
We had the following conditions to the offer:
– Subject to a builders report to the purchasers satisfaction.
– Subject to finance approval.
– Subject to a solicitor reviewing the contract to the purchasers satisfaction.My understanding of the process was that once we put in a written offer, the agent would then present the offer to the owner and come back to us with a response. Depending on the response, you would then perhaps further negotiate terms, conditions and price.
Then once an agreement had been reached between both parties a contract would be signed solicitors involved etc.
However in this instance the real estate agent insists that we sighn a contract before he presents the offer to the seller. This immediatly started alarm bells ringing.
Can anyone shed any light on why the agent might ask this? Is my idea of the above process wrong? Could anyone share thier experience with a typical written offer on a property?
Being very new to this I am still learning LOTS, very QUICKLY
Any feedback would be greatly appreciated.
Regards & Thanks,
Tim Wilson.
“Poverty is not an option”
Tim,
I made an offer on a property in Queensland once and was surprised to find that the agent required I sign a contract rather than an offer.
I put it down to banana-benders doing things differently and mused about what would happen in the counter-offer process.
Well – the contract was faxed back and forth and every counter offer meant a line through the precious figure and then signatures. It was a shambles, but it was the way the market worked.
Anyway, so long as you have a ‘get-out’ clause… what difference does it make if you sign a contract or not?
Oh – and by the way – three get out clauses is surely almost an overkill isn’t it?
For what its worth I don’t think you did anything wrong and now your more experienced for the effort. But what did your lawyer say about the process?
Steam_Train
P.S. What’s poverty then? A choice?
Hi,
Been in the same situation before, albeit a costly experience. Sometimes they just want to make sure your serious and that they can show something on paper so that they (the agent) can prove they have done some work [
]. If you are serious Tim, it should be okay aslong as you have your exit stratagies including all your conditions which safeguard you. Perhaps you can include another stipulating that both parties are able to negotiate an acceptable price etc, but are free to recind the contract if an acceptable outcome cannot be reached. You would have to contact your lawyer (I hope you have one in mind prior to making an offer) who could assist you with wording conditions and with whom you can discuss this issue with.
Ask the agent WHY an offer of interest is not acceptable.Good Luck
Soosh [
]It’s all our imperfections that make us perfect!
Tim
our experience is that you DO sign your offer. Otherwise it is not legally binding and is thus Q.E.D. not an offer.
Advice we have received is that: to be binding, an agreement for the sale of land (with/without improvements such as a house) must be reduced to writing.
If you were the vendor and someone gave you an un-signed contract to reply to, would you really think that they were serious ??
In terms of using a letter of offer, you still have to sign it, so I guess that I don’t see the problem here. Apparently,a letter of offer can be binding if it contains all of the elements of a contract.
You must ask your solicitor to clarify all of these points for you.
just my 11c worth (10c + GST) [
]cheerio, Bruce
(ps: Q.E.D. is some really cool thing in Latin taht often comes up at the end of complicated maths proofs that I have never been able to remember. I just think “Quite Easily Done” [
])Thank you all for your replies and input to this, it’s been a great help. Sounds like I just need to go about things slightly differently.
It certainly can be an interesting experience placing offers! One thing I have learnt, is that you must be on your toes!Must push on.
Regards,
Tim
“Poverty is not an option”
Hi Tim, we banana benders are a crazy bunch. [
].Thanks to the two-tier rubbish that gave QLDers a bad name, our contracts now have a 5 day cooling off period as well. As Soosh mentioned, the wiesel clauses are still valid on your contract.
In Qld, building/pest and finance are already written into the standard contracts supplied by the REIQ, so you don’t need to repeat them. Plus it let’s you put in your particular special conditions (weisles) without the vendor being scared by a huge long list.
Make sure you put in the Financier section of the contract “Buyer’s Choice” so you can’t be roped into junk interest rates by the agents/developers lender.
A second point about Qld, it’s just become law that EVERY house sold must have an electrical safety switch installed and the Ruling is that it’s the BUYER’s expense within 90 days of settlement. We add this into our special conditions (that the Seller installs it) and haven’t had anyone object yet. Just food for thought.
Another thought, I definately prefer to have the offer made on a contract. We offer low and if a venodr accepts, I want him to sign it securing my position as quickly as possible. Some of my agents will make my offers verbally, knowing I’m good for the deal, but in this sellers market (which we are experiencing here at the moment), I don’t want to get guzzumped by someone who actually put pen to paper on a contract. Same amount of writing, more protection of securing the deal.
Most of our contracts look like the kids have done them after multiple offer cross-outs.
That’s my 10 cents worth (running a business I got my GST back. HeHe!)
Seeya guys, as a Qlder would say AVA GOOD Weegend!
Remember, life’s about Family, Fun and Finance (probably in that order).
Mike
Director
http://www.PositiveCashflow.com.au
“Positive Cashflow for a Positive LIFESTYLE”
because
“Life’s too short to be Negative”Hi there,
Just a quick note. The “weisle (Mike mentioned)” special conditions are for your protection and HAVE saved us from making HUGE mistakes, which may have ruined us completely. Don’t be bullied by anyone into avoiding these additional conditions it doesn’t cost you a cent but may save you hundreds. When I wrote in these conditions I had NO idea they were called ‘weisle’ clauses, but even knowing now, I’d rather it be called ‘weisle’ the leaving them out and everyone saying I was an Idiot for leaving myself open to well known racketeers.
QLD market has tightened up significantly but remember there are people who make a living on finding Loop Holes, definitley they have their employers interests at heart, not yours.I’m sorry Mike if I offended you with the suggestion of these clauses, but I am only new to investing and maybe I can one day find a better way to protect my interests without wasting others time, wading through contracts like these. Perhaps you could suggest something that would be better. I’d be happy to hear it.
Cheers [
]Sooshie
It’s all our imperfections that make us perfect!
Hi Sooshie, no offence at all. One thing about property investing is you grow big shoulder and a healthy self esteem.
I actually hate the word “weasel” as it sounds a little derogatory, “safety net” clauses or “fall-back” clauses are nicer terms, but they still give you the same protection.
A side note. I just secured a deal by writing a written contract offer. An expression of interest had been received by the agent (from another wrapper), but because I put a more “committed” offer down with a deposit (only $50- I might add) I secured the deal.
Much like going on a date. If I said to a woman “I’m really excited by you, I want to go out on a date with you at 8pm on Saturday night”, there’s a good chance I’ll get that date. If I said “Yeah, look you look like you could be sorta OK, if ya wanna, some time we can maybe do something, whadda ya reckon”. My dating options are limited. [
]. Only say this for fun value, very happily married guy.Point is though, it’s worth the extra effort to secure a deal (in my opinion).
Love reading your posts Sooshie, you add real personallity to the forum.
Best to all,
Mike
Remember, life’s about Family, Fun and Finance (probably in that order).
Mike
Director
http://www.PositiveCashflow.com.au
“Positive Cashflow for a Positive LIFESTYLE”
because
“Life’s too short to be Negative”Hi Mike,
Committed {[
]} !!! I guess that’s what your saying. Showing your
commitment to the agent, vendors,deal etc. Makes good sense.
Would you believe there are some girls who’d go out with a guy
who’d said the latter.. (Not me of course)It takes all types…Cheers and glad you have a good sense of humor [
]Sooshie
It’s all our imperfections that make us perfect!
Soosh,
Enjoy you perspective keep onm writing.
Mike,
Good to have someone of your experience on the site. I must meet you at a vendor finance meeting…the next one.
Enjoy
AD [:0)]A great deal of talent is lost to the world for want of a little courage. Every day sends to their graves obscure men whose timidity prevented them from making a first effort.
-Sydney Smith
]. If you are serious Tim, it should be okay aslong as you have your exit stratagies including all your conditions which safeguard you. Perhaps you can include another stipulating that both parties are able to negotiate an acceptable price etc, but are free to recind the contract if an acceptable outcome cannot be reached. You would have to contact your lawyer (I hope you have one in mind prior to making an offer) who could assist you with wording conditions and with whom you can discuss this issue with.
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