From Offer to Contract
The process from first offer to final agreement can be quick, or it may involve several steps over a longer period of time. It can be an intense time, but bear in mind that you and the builder are aiming for the same goal.
Your signed offer is presented to the builder who, by the irrevocable date, will either:
- accept it as written. His/her signature on the offer results in a contract that is binding on both parties. Or,
- counter your offer (by changing the price, terms, closing date or other points). Changes are made directly in the Agreement of Purchase and Sale document. A new irrevocable date is set, by which you must respond to the builder's offer, failing which the offer is no longer valid.
If your builder makes you a counter offer, you may decide to accept it or you may wish to re-counter.
This process continues until an agreement has been reached between you and your builder, or you determine that an agreement cannot be reached.
If your accepted offer was conditional on financing, you now need to apply and receive approval for a mortgage within the time specified in the contract. If you are unsuccessful in obtaining the necessary funds, the contract is no longer valid or binding, and your deposit will be returned to you in full. The same process holds true for all other conditions written into the contract.
Bring a copy of the Agreement to your lawyer. When it includes a condition for a legal review, the lawyer may suggest changes to the wording and the clauses of the contract to further promote your interests. The builder should be notified immediately of these recommendations, allowing enough time for a review by the builder and/or the builder's lawyer before acceptance or possible counter.
Once your offer has been accepted and all conditions have been waived, you have a firm contract.