Now that we’ve found, actually let’s pretend we’ve found the property you want to offer on. I’ve put together some of the key elements involved in putting forth an offer that you should know. This is not the process of writing and presenting an offer, that comes later as my website grows, but rather definitions…
Pre-approval is NOT financed! I do hope you’ve spoken to your lender and have been pre-approved…thank you. Financing is the for a mortgage, the property will require an appraisal to assure the lender that the price you are paying falls within accepted market value. Once your financing has been approved you are required to provide written notice to the Seller in the form of a waiver of amendment before the expiry of the condition.
This is the date set for the transfer of ownership of the property negotiated between you and the Seller and can also be referred to as the closing date.
For the offer to be valid, it must contain a number of specific dates and times. Your initial offer will be valid for a specific period, dates and times. Your initial offer will be valid for a specific period of time, usually until midnight of the same day or the following day, after which the offer is deemed to be dead. This time frame is called the irrevocable period.
This is the period in which your lawyer must determine if there are any problems with the title of the property and is usually set 7-14 days prior to the completion date.
Chattels, unlike fixtures, are not deemed to be part of the property and must be specified in the offer if you want them included in the sale. The following are some items you may wish to include in the offer: appliances, garage door openers, TV wall mounts, area rugs, blinds/curtains/draperies, wood burning stoves and other items that can be easily removed from the home.
This is the date set forth in the offer for each solicitor to review the contract but not limited to its; wording, clauses; timeframes; conditions & etc. to ensure each party is properly represented & protected.
This is the date set forth in the offer for each solicitor to investigate the validity of title to the property to be transferred ensuring encroachments, rights-of-ways, or easements will not prevent the new owners from the enjoyment of their property. Normally it is investigated shortly after accepting an offer as part of the Buyer’s due diligence within a specified timeframe of 7-10 days.
Timelines agreed upon to examine the title to the property at the Buyer’s expense to satisfy the Buyer there are no outstanding work orders or deficiency notices affecting the property and its present use may be lawfully continued and may be insured against risk of fire.
This condition applies only to the purchase of an Ontario condominium. It allows your solicitor to review the condominium’s documents to ensure the corporation is financially sound and meets all the requirements of the Condominium Act. Under the Condominium Act, the property management company has up to 10 days to prepare the Status Certificate and can charge a maximum of $100 for the service.
This condition applies only to the purchase of a Nova Scotia condominium. It allows your solicitor to review the condominium’s documents to ensure the corporation is financially sound and meets all the financial obligations from year to year and is financially sound. In Nova Scotia this is paid for the Buyer, and not the Seller.
A deposit cheque is a good will gesture from Buyer to Seller to be used as security on completion of the transaction. Although technically your Seal or your signature is legally sufficient, most sellers will layout in the offer a required monetary value to be submitted with the offer, or shortly thereafter to the Seller’s brokerage office or their solicitor. This will be securely deposited into their trust accounts. Typically the amount of the deposit will vary depending upon the value of the property but usually represents from a few thousand dollars in Nova Scotia to up to 5% of the purchase price in Ontario.
Fixtures are any items permanently attached to the property. For example, light fixtures & built-in appliances like dishwashers, stovetops, and wall-ovens are actually affixed to the home by means of plumbing or electrically wired, but still recommended to be written into the offer. Other items like a bathtub, sink or toilet permanently plumbed in would be a fixture and considered as part of the home. Technically, anything nailed to the building is a fixture while items screwed in (because screws can be removed) are chattels. This is often an area of contention when buying a resale home. So be aware of this distinction and, if in doubt, put it in the offer.
This condition provides an opportunity to have the property inspected by a qualified person who will look for any major defects in the building prior to your entering into a firm agreement.