An offer is a written agreement to buy a specific property at a specific price. It's one of the first steps in purchasing a home, and it's a crucial step in the process. But what does it mean to make an offer on a house? Are you locked into the contract once you make an offer?
The Importance of an Offer
When you make an offer on a house, you're putting your money where your mouth is. You're saying to the seller, "I'm interested in this property and I'm willing to pay this much for it." The seller can then accept, decline, or countered-offer.
If the seller accepts your initial offer, congratulations! You're one step closer to owning your dream home. If the seller declines your offer, they may provide you with feedback as to why they rejected it. Sometimes, sellers will provide a counter-offer, which means they are willing to sell the property but at a higher price than what you originally offered.
Making an offer on a house is an important step in the process because it allows you to put your intentions in writing. It also protects both parties should anything go wrong during the negotiation process.
Are You Locked Into the Contract?
Now that we've gone over what an offer is and why it's important, let's answer the question: are you locked into the contract once you make an offer?
The answer is no—you're not locked into the contract. An offer is not binding until both parties have signed it. So if you've made an offer and then changed your mind, you can rescind your offer without penalty.
The same goes for sellers. If a seller has made an offer and then decides they don't want to sell after all, they can back out of the contract without penalty as well.
However, just because you can back out of a contract doesn't mean that you should. Once you've made an offer on a property, it's generally considered good faith to follow through with that offer unless there are extenuating circumstances (for example, if the inspection reveals significant damage that was not disclosed beforehand).
Making an Offer on a House: What Does it Mean & Are You Locked Into the Contract? offers are important because they allow both parties to put their intentions in writing and protect each other should anything go wrong during negotiations. However, offers are not binding until both parties have signed them, so if you change your mind after making an Offer ,you can still back out without penalty