I made an offer on a property and received an acceptance by email from the seller's agent with some contingencies. He wants me to schedule the home inspection but the property is still listed on the MLS (or at least on a couple of the big websites, presumably on the MLS as well) and I haven't seen the condo documents. Doesn't this leave the seller open to back out if they get a better offer after I have done the inspection? I think I am going to decline to schedule it until I have seen the condo docs and until I have the seller's signature on my offer. Is this reasonable of me and how one would usually do things?
@Donald M. I think it is very reasonable to wait until you have a signed agreement to spend money on the property. Who wants to spend money on a property that they don't have rights to, or may not end up with?
If you have an executed contract (signed by both parties with EMD made) then it's not a big deal. They can take backup offers but if you have it under contract it's up to you whether it closes or not. I will often leave my properties active with contract until the initial hurdles are cleared if I think the buyer might be flaky.
Thanks for the advice, will wait until a signed contract to proceed.
I do the same thing with my properties, especially if traditional financing is involved. I'm not losing out on potential buyers if a property inspection comes back with a leaky pipe, that person gets cold feet or tries to renegotiate something crazy. More often than not, I tell people to have their inspections prior to me accepting the offer.
@Donald M. A ratified contract means you have it under contract and the buyer can not accept any other offers besides back up offers. Some agents are just bad at updating information in the MLS. I have a deal closing this week that the listing agent did not update in the MLS as being under contract till almost two weeks after we had a ratified contract, and our MLS rules state it needs to be updated within 48 hours.
Also the sites that draw information from the MLS like Zillow can just be dead wrong. So I wouldnt pay any attention to that.
Now regarding getting the condo docs and when to order the inspection...that is going to be a little bit sensitive to both state law and what your contract states. In Maryland you are supposed to get the condo docs within 7 days. Although if the unit is a foreclosure, its possible you never receive them in my experience. Now when to schedule the inspection depends on what you dictated in your contract. In the DC metro area the typical inspection clause is valid for 7 days. I usually try to ask for 10 days. Although there are some areas where if you want to realistically acquire the property the inspection needs to be waived altogether.
So check your contract, see when you home inspection contingency ends, and get it done a day or two before at least, so you have time to consider the report.
Free eBook from BiggerPockets!
Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!
- Actionable advice for getting started,
- Discover the 10 Most Lucrative Real Estate Niches,
- Learn how to get started with or without money,
- Explore Real-Life Strategies for Building Wealth,
- And a LOT more.
Sign up below to download the eBook for FREE today!
We hate spam just as much as you
Join the Largest Real Estate Investing Community
Basic membership is free, forever.