How to respond to an offer to purchase
It’s happened: a buyer is ready to make an offer to purchase your property! At this point, you have several options open to you. And remember, you’re not required to make a decision right away.
First, a quick reminder of the 5 things you’ll find in the Offer to Purchase:
- Price and terms
- The buyer’s and seller’s commitments
- Signature and acceptance
- Meeting the conditions
Once you receive an offer to purchase, here are the steps to follow.
Acknowledge receipt of the offer
Once you have the offer in hand, begin by checking how much time (usually 1 to 10 days) you have to accept this offer on your real estate. Thank the buyer for their interest and let them know you will think it over before following up on the offer. Schedule a meeting to get together with the person again
Take time to consider
At this stage, it’s a good idea to call a DuProprio notary* or a notary in private practice. With their input you can check and fully understand all the clauses in this commitment to purchase. This will help you decide whether it truly meets your needs.
Make your decision
There are three possible responses you can give the potential buyer: accept the offer, make a counteroffer or refuse the offer. But be careful: not responding within the set-out timeframe will cancel the offer to purchase.
1. Accept the offer to purchase
If you agree with the terms included in the offer (price, conditions, occupancy date, etc.), you can choose to accept it. That’s the best scenario. Just remember than an accepted offer to purchase becomes an irrevocable contract. That means you must comply with the terms and conditions of the sale given in the document as well as their time frame.
However, accepting the purchase offer doesn’t necessarily mean that the house is sold. If there are conditions included in the offer to purchase, they must be met before you can put the “J’ai vendu” sticker on your sign.
The 72-hour clause
If the buyer’s offer to purchase is conditional on them selling their own property, you might be able to accept the offer and still leave the door open for a second offer. Get all the details on the 72-hour clause in our article on that topic.
2. Submit a counteroffer
You’ve read the offer and you’re fine with most of the terms, but not all? You can make a counteroffer to the potential buyer, in which you can modify the terms and conditions listed in the initial offer to purchase. For example, you can say you agree to all the terms but would like to receive a different price than the one offered.
To keep from going back and forth with counteroffers, it is in your interest to negotiate the terms in person. Speaking with the buyer will make it easier for you to come to an agreement that can then be put on paper in a new offer to purchase.
3. Refuse the offer to purchase
If you’re not satisfied with what has been offered, use tangible reasons and clearly explain why you are refusing the offer. For instance, you might say that the offer price is not in line with the analysis of comparable properties you have. The buyer then has the chance to reconsider their position and come to a reasonable compromise.
Advise the buyer
Regardless of your decision, indicate it by checking the right box in the Seller’s Reply section in the Offer to Purchase document :
If you are accepting the offer, do what you can to finalize the transaction as soon as possible. If a problem arises, remember the only professionals authorized to provide legal advice are a DuProprio notary,* a private practice notary or a lawyer.
Are you thinking of selling a property? Contact us from anywhere in Quebec to find out how DuProprio can give you visibility and support at this pivotal time in your life.