Browse Forums Real Estate 1 Feb 25, 2009 7:06 am Hi all and a very good morning!
I am a first home buyer and am looking around for properties. I do have some questions regarding sales/offers. 1) If a property is listed as "under contract/offer", does this mean that there is one particular offer that is being negotiated or that the owner has 2-3 offers and is still trying to get the best deal? Is the property still up for sale if it's listed as "under contract/offer"? 2) If a property is listed as "under contract/offer" on the webpage, why is it still open for inspections for 2-3 more weeks continuously? Does that mean the owner is looking for a better price? Wouldn't the owner prefer to negotiate with the current person who's placed an offer rather than opening up a place for inspection because that'll cost more? How many open inspections would a seller usually conduct even if there's been offers on the property? 3) I have been told various things by people re: offering for a place. One of the advice given was that you should always offer the best price that you're willing to give. Reason being that agents are not supposed to tell you that there is another offer say approx $10k more because that's like a private auction which is illegal. What do you think? 4) Is "subject to finance" a common condition? I asked this because one of my friends listed this as a condition on his offer and he got a call from the agent asking exactly how much the bank is willing to finance him. Isn't that confidential? My friend mentioned that he has already got loan pre-approval however the agent was persistent in asking more questions. Was the agent justified in asking these questions? Or should my friend have left out "subject to finance" on his offer? Thanks for your time! It's such a headache buying a home! Re: Questions for first home buyer 2Feb 25, 2009 10:47 am Quote: 1) If a property is listed as "under contract/offer", does this mean that there is one particular offer that is being negotiated or that the owner has 2-3 offers and is still trying to get the best deal? Is the property still up for sale if it's listed as "under contract/offer"? I cant answer all your questions but just a few points: From previous threads it appears the words "under contract/offer" have different meanings from state to state - in SA it means there has been a conditional contract/offer on the house - usually conditional to finance, sale of owner's property or building inspection but possibly other things. In which case it seems perfectly fair for property to still be advertised as it is possible conditions may fall thru - ie buyer cannot get finance, sell other property etc. In SA it wouldn't be about the owner getting the best deal, they would have accepted an offer subject to whatever condition and selling price will not change. However there is no harm in contacting agent to say you are interested - they can then get back to you if sale falls thru, which they not uncommonly do. Quote: 4) Is "subject to finance" a common condition? I asked this because one of my friends listed this as a condition on his offer and he got a call from the agent asking exactly how much the bank is willing to finance him. Isn't that confidential? My friend mentioned that he has already got loan pre-approval however the agent was persistent in asking more questions. Was the agent justified in asking these questions? Or should my friend have left out "subject to finance" on his offer? Yes, its a very common condition - I would say far more homes are signed subject to finance than not, especially in the first home owner range. I don't think your friend should of left out 'subject to finance' in his offer or he would have been in very difficult position if he signed unconditional contract and then could not get finance. Yes, he had pre-approval but, as other posts on this forum have shown, it is not impossible for bank to then change their position - unlikely but possible that their criteria change, interest rates go up makeing loan unaffordable etc. We have bought 2 houses, 1 construction contract and assisted one son with buying, all signed subject to finance, and have never had anyone pester us about the amount, sounds unethical on agents behalf. Re: Questions for first home buyer 3Feb 25, 2009 11:34 am Helyn We have bought 2 houses, 1 construction contract and assisted one son with buying, all signed subject to finance, and have never had anyone pester us about the amount, sounds unethical on agents behalf. It may just be prudence on the sales agent's behalf - s/he wouldn't want to be turning away potential buyers if there was a high chance that you couldn't get finance. Re: Questions for first home buyer 4Feb 25, 2009 12:02 pm When i bought my place, i only put it subject to a building inspection. I made the risky move of not puting it subject to finance. It paid off in the end and i had a back up plan if it didn't work out, but i would not attempt to do it again. Things are a lot more unstable at the moment! Re: Questions for first home buyer 5Feb 25, 2009 12:04 pm I can't answer all your questions but yes, the subject to finance is very common. If l were to buy again, l would get a conditional or pre-approval from a Bank before l even started looking at houses!
One it keeps you to a limit and two, if you and another party both made the same or similar offer on the same house but yours was not subject to finance.....which offer would the vendor more likely accept? Re: Questions for first home buyer 7Mar 06, 2009 1:23 pm idealist 4) Is "subject to finance" a common condition? I asked this because one of my friends listed this as a condition on his offer and he got a call from the agent asking exactly how much the bank is willing to finance him. Isn't that confidential? My friend mentioned that he has already got loan pre-approval however the agent was persistent in asking more questions. Was the agent justified in asking these questions? Or should my friend have left out "subject to finance" on his offer? Also, you do not have to disclose how much finance you are approved for, nor should you!!! Re: Questions for first home buyer 8Sep 06, 2009 11:06 pm Briz Ms idealist 4) Is "subject to finance" a common condition? I asked this because one of my friends listed this as a condition on his offer and he got a call from the agent asking exactly how much the bank is willing to finance him. Isn't that confidential? My friend mentioned that he has already got loan pre-approval however the agent was persistent in asking more questions. Was the agent justified in asking these questions? Or should my friend have left out "subject to finance" on his offer? Also, you do not have to disclose how much finance you are approved for, nor should you!!! The reasoning behind the agent asking this question is not for them to find out how much the bank will finance them in total, but to find out how much they will be borrowing for the property. Agents are the link between the purchaser and the contracts being made up by the solicitors. For example, if you were buying a house for $300,000 and had $40,000 saved for a deposit, once the banks have added all the other expenses (stamp duty, land tax, solicitors etc) you will find your loan is not for $260,000 it might be for $280,000. Your contract would then read something like subject to finance from: xx bank, by:xx/xx/xx for an amount no less than $280,000. If you don't tell the agent the amount then if your bank only agrees to lend you $250,000 you are still bound by the finance clause in the contract because technically your finance has been approved. Hope that makes sense! Not much in this responce. My suggestion is, what are you looking to build and why. This will all be impacted by the local councils planning scheme. Familiarise yourself… 6 5819 Hi Suku18 In NSW the statutory required insurances are: 1. HBCF ( Home Building Compensation Fund) - This is if the builder dies or goes broke. But this only covers 20%… 1 2649 A quick update, we didn't have site start before Easter. Summit can't seem to give me a day when they are scheduled to begin, so I'm left with a vague "within 10-20… 4 26705 |