Quite often, Offers are made by purchasers who either still need to secure a mortgage or sell their own property.
In order to be transparent to the seller and to protect their own position, they will make an Offer conditional on them obtaining a mortgage and/or selling their own property.
At the stage of making an Offer, the purchaser will generally have had a “decision in principle” from their mortgage lender.
This will confirm that they will be offered a mortgage once the full mortgage application is made.
The purchaser will also likely have received a written Offer from someone who wishes to purchase their property – which Offer could very likely also be conditional!
As the seller, you may be happy with the price that is being offered but the purchaser will not be able to legally bind themselves to the contract until the conditions in their Offer have been removed.
How and when are conditions in Offers removed?
Once the purchaser’s mortgage offer has been issued by a lender, the “subject to finance” condition will be deleted from the Offer in the Qualified Acceptance (the written acceptance produced by the seller’s solicitor in response to the Offer).
Similarly, once missives have been concluded for the sale of the buyer’s property, the “subject to sale” condition will be deleted in the Qualified Acceptance.
At this point, a date of entry can be agreed and missives can be progressed.
Once missives are concluded, both parties are legally obliged to buy and sell.
There’s no going back at that point…
How we can help
This article discussed why conditional offers are an essential part of the house-buying and selling process – so there’s open-handedness that the prospective purchaser does not yet have all the pieces in place to finalise the deal and also protection for that purchaser from being tied into a contract before they know they can fulfil it.
If you have any related questions at all, don’t hesitate to contact us. Initial enquiries are at no cost and there’s no obligation to formally engage our services. Contact us whether you’re looking for clarification of anything that’s not fully explained in this article or have a question about any of our wider house buying and selling services.