Liability upon submitting an offer

User Forum Topic
Submitted by sushilover on October 27, 2008 - 12:53pm

My realtor showed me a bank-owned property on Saturday. When I told him I liked the property but could not make the decision at that moment, he asked me to make an offer anyway. He said I am not committed into anything by doing so and I can always withdraw my offer by not signing papers prepared by the seller (in this case the bank). He assured I am not getting into any contract or owing any money i.e. deposit by merely submitting an offer. How true is that statement?

Thanks ahead for your advise.

‹ Attending a Trustee Auction With today's events and more banks certain to fail, who is still going to buy DESPITE falling home prices? ›
You will be asked to write a
Submitted by Eugene on October 27, 2008 - 1:02pm.

You will be asked to write a check (typically, for 1% of the offer), the check will be cashed if your offer is accepted, so you should have that much money in your checking account. You can withdraw the offer at any time prior to acceptance. Even if the offer is accepted, there will be a period of time during which you can get back the deposit and walk without any liability or obligation.

Thank you so much.
Submitted by sushilover on October 27, 2008 - 1:17pm.

Thank you so much.

Don't take anyone's word for
Submitted by sdduuuude on October 27, 2008 - 4:04pm.

Don't take anyone's word for it. Take time to read and understand the whole offer letter that you sign. That will tell you your answer.

Just to add a little
Submitted by SD Realtor on October 27, 2008 - 5:53pm.

Just to add a little bit...

When you submit your purchase offer for the REO you do not even need to deliver the check. You can make a copy of the check and send that along as proof of the deposit. If the offer gets accepted then you technically have 72 hours to deliver the check to escrow. Escrow will cash the check.

During the escrow period you will have a fixed amount of time known as the contingency period to perform your inspections and complete your own due diligence on the property. Your contingency period duration will be spelled out clearly in the purchase agreement AND any addendum that the bank will ask you to sign. Make sure your agent clearly spells out the duration of the contingency period with you.

If you decide to back out before the contingency period expires you need to cancel escrow, and once both parties have agreed to the cancellation escrow will mail you a check back for the amount of the deposit. It usually takes a few days after escrow closes.

One note, there is indeed little risk submitting an offer. However if it causes you stress then don't do it. Do not buy a home if you are "iffy" on it.