-An Offer to Purchase is a legally binding contract that cannot be easily withdrawn once signed, resulting in penalties.
-Buyers should ensure their finances are in order and obtain pre-approval for a bond before making an offer.
-Both buyers and sellers should be aware of important clauses, such as the 72-hour clause.
-Before eagerly signing the Offer to Purchase for your dream home, take a moment to familiarize yourself with its crucial aspects.
Here’s our comprehensive guide to help you navigate the Offer to Purchase and make informed decisions.
The Offer to Purchase is Legally Binding Once you sign the agreement, it becomes difficult to withdraw without facing significant penalties. Exceptions to this rule exist when either party fails to fulfill their obligations as specified in the agreement, allowing for a withdrawal. Additionally, a buyer can provide written notification within five days of signing if the offer is less than R250,000.
Thoroughly Read and Understand the Offer to Purchase It is vital to comprehend your obligations and ensure the inclusion of terms and conditions that protect your interests. Consider seeking advice on important inclusions specific to your situation.
Examples of Inclusions for Buyers:
- Requiring the seller to conduct a property inspection and address any evident defects.
Examples of Inclusions for Sellers:
Setting a deadline for the buyer to fulfill their obligations, providing an opportunity to explore other potential buyers if necessary.
Ensure the Accuracy of Details
Check that the property description, as well as your personal information, is accurate in the Offer to Purchase. Verify that the agreed-upon price is correctly stated.
For Buyers: Confirm Your Desire for the Property
Before proceeding, conduct a final inspection to ensure the property meets your requirements. You may consider gathering information from neighbors regarding the location, such as noise levels, safety, and accessibility to essential amenities.
For Buyers: Assess Affordability
To avoid future financial strain, verify that you can comfortably afford the property. Ensure your finances are well-organized, and a budget is in place.
Be Mindful of the 72-Hour Clause (Buyers) This clause allows the seller to continue marketing the property and accept a better offer if received. If you fulfill your obligations within the specified 72-hour notice period, the seller cannot accept another offer. It’s important to note that most sellers are unwilling to remove this clause.
Applying for a Home Loan
Once the Offer to Purchase is signed, the subsequent step involves applying for a home loan. We can assist you in securing the most favorable deal by submitting your application to multiple banks, enabling you to compare and select the best offer tailored to your needs. We also provide useful tools to simplify the home buying process, such as our affordability calculator and Bond Indicator, which help determine affordability. When you’re ready, you can proceed to apply for a home loan.