What are the main elements of an offer? Price, deposit, terms, conditions etc. 

This article will help guide you through the offer process and explain in plain language each element involved in making an offer on a new home.

What are the main elements of an offer?

Price
The price you offer reflects your opinion of the value of the house and is determined by the condition of the property and local market factors. You can make any offer you like. It does not have to be the same as the seller's asking price.

Deposit
The deposit shows your good faith and will be applied against the purchase of the home when the sale closes. Your Royal LePage Realtor can advise you on an appropriate amount.

Terms
Include the total price offered and the financing details. You may arrange your own financing or ask to assume the seller's mortgage, especially if it has an attractive interest rate.

Conditions
Conditions are items that must be completed or fulfilled prior to an offer being concluded. These can include subject to home inspection, subject to you obtaining financing, or subject to you selling your existing property.

Inclusions and exclusions
Your offer may be contingent on certain items being either included or excluded in the sale. These might include appliances, fixtures, and decorative items, such as window coverings or mirrors.

Closing or possession date
The closing date is generally the day the title of the property is legally transferred and the transaction of funds finalized, unless otherwise specified (except in Manitoba and Quebec). In British Columbia the possession date is legally one to three days after closing.

What happens to my offer to purchase after it is drafted?
Your offer to purchase will be presented to the seller as soon as possible after it is drafted. The seller can accept your offer, reject your offer, or make a counter offer.

Acceptance
An accepted offer means the seller has agreed to all the terms and conditions exactly as set forth in your offer to purchase.

Rejection
A rejected offer means the seller did not agree with any of the terms and conditions set forth in your offer to purchase.

Counter offer
A counter offer means the seller agrees with some of the terms and conditions of your offer, but not all of them. The seller then makes a counter offer. The counter offer may change the price, the closing date, or add or delete conditions. Once you have received a counter offer you have two choices. You can accept the new terms and conditions or reject them. If you reject them, you can choose to start the whole process over again.

What happens on closing day?
Closing day is the day you become the official owner of your home.Typically, you visit your lawyer's office to review and sign documents relating to the mortgage, the property you are buying, the ownership of the property, and the conditions of the purchase. Your lawyer will also ask you to bring a certified cheque to cover the closing costs and any other outstanding costs. Once the mortgage and the deed for the property are officially recorded, you become the official owner of the property and your lawyer will call you to pick up the keys to your new home.

Congratulations! You've just bought a home.