Using “Conditional Offers” To Your Best Advantage

You find a home that you’re interested in buying. But you have concerns. Is it in a good state or repair? Will you be able to secure the right financing? Can you sell your current home in time?

Any of these issues can prevent you from making a prompt offer and as a result, cause you to lose the opportunity.

The solution? Make a conditional offer.

A conditional offer means just that. You offer to purchase the home so long as certain conditions, which you specify, are satisfied. Here are the most common examples:

• “Subject to financing”. You will buy the home if you’re able to arrange for a suitable mortgage.
  
• “Subject to inspection”. You will buy the home if it passes inspection by a qualified home inspector of your choice. If he or she finds that substantial repairs are required, you can either walk away from the deal or renegotiate.
  
• “Subject to selling my current home”. You will buy the home if you can sell your own home within a set period of time. For example: 45 days. A seller might agree to this if your home competitively priced.
  
• “Subject to the repair of ___.” You will buy the home if the seller makes certain repairs, at his or her own expense. This can range from something relatively minor, such as fixing a crack in the foundation, to major repair like replacing the roof shingles.
  

A Conditional offer will protect you. However, there is always the risk that the seller will say “No.” If you’re in a competitive situation, for example, and another buyer’s offer is unconditional. You may lose the deal-even if your offer price is higher!

So you really need to use conditional offers strategically, in just the right way, under just the right circumstances.

Get It In Writing

As you tour a potential new home, you notice that the carpeting in the living room is stained. “Don’t worry about that,” says the homeowner, who senses your disapproval. “We’re going to get the carpeting professionally cleaned before we move.”

Should you take their word for it?

Regardless of how honest a seller may seem, never rely on a verbal promise.
Will they move that abandoned car in the back yard? Will they fix the crack in the front steps? Is that expensive-looking ceiling fan included with the house?

Don’t assume. Get it written into the offer.