As explained in the first article about the sale of buyer’s home condition, when you buy a home and present the sellers an offer with the condition ‘sale of buyers home’, there are several very important factors you need to consider. We cannot emphasize enough that any buyer and seller must discuss every point and every scenario with the realtor. Many of your decisions will depend on your personal situation.
1. When you offer to purchase a home, and ask for the condition of the ‘sale of your home’, understand that your home must be on the market, listed on the MLS, within 48 hours. So it is very important to be ready to sell your home.
2. When your condition gets accepted by the sellers, but, for example 2 days later, another buyer comes along and also offers on the house, the seller can negotiate and accept that second offer as well. But this comes with a seller’s condition that the second buyer only gets the house when the first contract doesn’t hold firm. You, as the first buyer with your condition ‘sale of buyer’s home’, will have 24 or 48 hours time to fulfill all your other conditions. Now most likely you also have had a home inspection and financing condition in place. And yes, you must fulfill all conditions.
3. It is up to the sellers to disclose they have an accepted offer on the house. They will keep marketing the house. So chances are always there that a second buyer will come along with an offer. The sellers and the second buyer can negotiate just like normal. But perhaps the sellers can get a better price for their house with these second buyers, than the first buyer negotiated with them. If sellers come to a (better) ‘deal’ with the second party, the sellers will give the notice to you being the first buyer. Then your 24 or 48 hours start ticking and you must fulfill all your conditions, or you ‘lose’ the house to the second set of buyers.
What the contract states about the sale of buyer’s home condition
The following is copied from the AREA contracts we use in Calgary for real estate.
“7. If the Seller signs the Second Contract, then:
— the Seller will give notice (the Seller’s Notice) to the Buyer; and
— within _____hours of receiving the Seller’s Notice, the Buyer must give a Buyer’s Notice waiving, as per the Contract, all of the Buyer’s Conditions contained in this Purchase Contract.”
As you can see, there are advantages and disadvantages to both buyer and seller for using this clause. Read more about the advantages and disadvantages of the clause ‘sale of buyers home‘ when you are buying or selling, in the third article about this somewhat complex clause.
The above is general information only. It is not meant to be legal advice upon which anyone may rely. If you have questions about a specific property or transaction, please speak to counsel for definitive advice.