Real Estate

What you need to know about conditional vs unconditional offers?

What-you-need-to-know-about-conditional-vs-unconditional-offers

In case for the first time you are buying a home, confused and haven’t made any decision yet then whole situation goes to conditional vs non conditional offers. Read whole article to know about how conditional vs non conditional offers work.

Unconditional offer:

In this case, you are completely satisfied with the property in all condition and house is sold if the owner signs the offer but while bidding an auction, you have to bid on an unconditional basis.  Unconditional buyers are basically are cash buyers.  Unconditional offers are not subject to any due diligence.

Conditional offer:

Buying a house at certain price but some certain conditions are applied to it. Here are some examples of common condition:  finance, valuation, title search, LIM and builder report, solicitors approval , sale of your existing property etc.

For example, Certain price is subjected to five days working for a finance and a builders report.  In this you have two conditions i.e. finance condition and builders report condition and if you are ready to accept the offer and you happy with the offer and all conditions work out then it will go to the unconditional offer and the house is sold.  In case one of the two conditions will not work out then you can withdraw your offer and can look further. More condition may be included in anything you want to buy.

For example, I am not going to buy a flat before next month. More conditions you are offering then less attractive it will become to the owner.  The number of conditions determines the length of the time which is required.  The longer is your condition then larger the time is required. 

For example, working for 5 days or 10 days for a particular thing might make a difference for your decision making of accepting the offer.  Extra days in your offer sometimes might just end up costing you the house more.

Ask to 10 working days for confirming your finance arrangements means you are asking the owner  for two whole weeks to take their home off. In case you are not happy and want to change your mind and pull out, you can easily make your decision.  2 weeks are a lifetime in the world of an owner who has their home on the market.  To remove conditions on the offer they are looking for, a buyer can spend lot of money.

You can say that it would be a great investment as many owner accepts the second or third highest offer in a Tender because the offer is unconditional. Have you ever think that sometimes you need to be unconditional to win various offer situation ? As we all know price will always play a vital role but conditions goes to close second in a multiple offer situation. Or If the market is good or you can say it would be hot then the chances of an unconditional position to win are more.  

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