Real Estate Offer to Purchase
What is an offer to purchase?When someone decides to buy property, their realtor will put together what is known as an Offer to Purchase. This form that will be used for the Offer to Purchase is the Contract of Purchase and Sale. Once the seller has accepted the offer, this will now be a contract that is between the buyer and the seller. When the contract of purchase and sale has been filled out, this contract will include the date of the buyers offer to purchase, a brief description of the property the individual is making the offer to purchase, the amount of the deposit, the amount the buyer has offered, the amount the buyer has agreed to make on the down payment and financing details, the names, addresses of the buyers, the name and addresses of the owner, any closing dates, and any special requirements.
Can someone cancel their offer to purchase real estate, if so how do they go about doing this?This will all depend on what the contract states. In many contracts of real estate once the offer to purchase has been accepted by the seller the agreement will become enforceable and a required contract. What this means is that the seller can enforce the contract and sue the buyer for certain reasons, which is normally in order to get a court judgment to force the individual to follow through with the transaction. The only legal option the buyer will have is to try to negotiate for a release from the contract by offering more than their earnest money. Now, with that being said since the sellers do have an enforceable contract they are not required to accept the buyer’s negotiations.
If someone has signed an offer to purchase, and now they are wanting to back out of the contract does the 3 day rule apply to real estate offers?The three day cancellation law is often times very limited; the three day cancellation normally applies to door to door sales and phone sales. The three day cancellation will not apply to real estate offers to purchase.
If someone has made a residential offer to purchase and the seller has accepted the offer, what can the buyer do if one week before the closing the seller decides to sell the house and wants the buyer to sign a cancellation agreement and the buyer does not want to sign?In this type of situation there are two options the buyer is entitled to. One would be to file a law suit for the specific conditions of the contract and force the seller to follow through with the transactions. The other option would be to file a law suit for the damages that were caused because of the seller’s breach of contract. The buyer will have the right to sue for all their costs that were related to the contract, and sue for the loss of value if they have to buy another property at a higher price.
Who would be entitled to the earnest money in the state of California if the buyer had applied for two loans and they were turned down because the Housing of Association is higher than 15%?Normally if a contract fails because of financing problems the buyer is allowed to receive their earnest money. The reason for the earnest money is to protect the seller if the buyer decides not to go through with the sale. In this case the buyer has tried to follow through with the sale, and they are not able to because of something that is out of their control. The buyer will need to make sure that nowhere in the contract anything states about a loan contingent upon trying to gain financing. If there is nothing stated in the contract and the sale doesn’t follow through then the buyer will not be able to receive their earnest money, because the seller has taken the property off the market because of trust in their offer to purchase. This will not be considered the seller’s fault that the buyer was not able to receive financing.
When making an offer to purchase real estate, commercial or residential there are rules and requirements that are necessary to be met in order to follow through with this sale. Many times individuals run into financial problems where they need to cancel their offer to purchase. When cancelling an offer to purchase the buyer will lose their earnest money. For more information in making an offer to purchase contact the Legal Experts online.