What is the process of submitting an Offer on a house?
Phone Call to Check the Lie of the Land
Your solicitor might give the seller’s estate agent a phone call before submitting a formal, written Offer to them. During that phone call they will be able to find out whether there are any Notes of Interest on the property, any Offers already under consideration, or whether a Closing Date has already been set. It’s a useful way to sound-out the seller’s estate agent about what price the seller might realistically take and whether the Date of Entry is important to the seller.
Your solicitor might make a Verbal Offer on your behalf. Whilst not legally binding, it can be a good way to test what the seller is open to.
Written, Formal Offer
Formal Offers in Scotland are usually faxed and then sent in printed format. The written Offer is a legally-binding document. You can make an Offer to a property seller or to their solicitor or estate agent yourself but it doesn’t have any legal status. Many estate agents won’t even consider your Offer unless it has come through a solicitor.
Probably the most important part of the Offer.
Date of Entry
What date do you want ownership of the property to transfer to you? This is also the date when you pay the seller the purchase price. This can be very important to the seller, so the more flexible you are with your Date of Entry, the more likely you are to be successful.
Sometimes you’ll want to purchase additional items in the property, for example wardrobes or a washing machine. These have to be explicitly stated in the offer.
Areas of Concern and Specialist Reports
If you have doubts about certain elements of the condition of the property, it might be worth making any offer subject to you obtaining a satisfactory specialist survey. For example, damp, roofing or asbestos.
Offer ‘Subject to Survey’ Clause
It is common in Scotland that offers are subject to the buyer obtaining a survey that is satisfactory to them. What is satisfactory to the buyer is really up to the buyer’s discretion. This means that the offer really is only a first step in a negotiation process and the buyer is still in a position to withdraw from the purchase. The Offer, although it has a legal ‘status’, can’t simply be ‘accepted’ because the buyer will have to later withdraw that condition from their Offer for it to be possible for the seller to accept it.
In addition to these specific points, Offers in Scotland are often subject to ‘Standard Clauses’, created by conveyancing solicitors in an attempt to make Offers simpler and easier to deal with. Some of these, however, won’t be suitable for your circumstances and your solicitor will run through these with you during the process.
If I submit an Offer, am I entering into a contract if the seller agrees on the price?
If your Offer is subject to any conditions (such as ‘subject to survey’), you are in a position to withdraw from the Offer. It is frowned-upon to submit an Offer and then pull-out at a later stage, but the seller’s solicitor or estate agent should have warned the seller that this is always a possibility.
Do I get a chance to submit another Offer if my Offer is turned down?
Submitting an Offer is often just the start of negotiations. Often the negotiations are about the Price, but other things can be important to sellers too. The Date of Entry is usually the next-most important issue for sellers who will often want to try to tie the Date of Entry of the property that they are selling to the Date of Entry of the property that they are buying.