Home Purchase Offer: Guide for First-Time Buyers

How a Purchase Offer Works When Buying a Home

In recent weeks I have often had the opportunity to interact with young clients interested in buying a home. I am mainly referring to young couples who are facing such an important step for the first time in their lives and who often do not know where to start.

It frequently happens that young clients need clarification about the entire buying process in order to understand exactly what they need to deal with it and to make their dream come true. There is always the fear of encountering problems of various kinds, such as urban planning or cadastral irregularities, the presence of mortgages on the property, or difficulties in obtaining a mortgage loan.

For this type of client, the real estate agent becomes more than a mediator. Faced with many doubts, the agent accompanies the client through every stage of the purchase, clarifying and simplifying the operations that will take place.

For this reason, I would like to answer the questions I am asked most frequently:

1. How does a purchase offer work?

First of all, a purchase offer must be made in written form, using the forms provided by the real estate agency, and it is valid for a defined period of time.

This means that the offer must include a deadline within which the seller may accept it, reject it, or declare willingness to sell at a different price or under different conditions (in which case it is called a counteroffer).

A purchase offer is the formal declaration of a person interested in buying a property at a specific price and under certain conditions.

To guarantee the seriousness of the offer, a validity period is set (generally between seven and thirty days) during which the offer is irrevocable.

Irrevocable means that the potential buyer is bound to their proposal and cannot change their mind until the deadline expires. If the seller accepts the offer during this period, the deal is considered concluded and the proposer must honor what has been established as a deposit (caparra confirmatoria).

Once the validity period has expired, the proposer is no longer bound by the offer.

The buyer can continue searching for another property and may submit a new offer. The seller will not have any claim against the proposer. Naturally, the validity period of the offer can be extended, but only with the express agreement of the parties.

2. What are the essential elements of a proper purchase offer?

A purchase offer must contain some essential elements. For example, the name of the proposer and the owner, as well as a description of the property (preferably including cadastral details).

It is also important to formally specify whether the property is vacant or rented, and especially how it will be delivered at the notarial deed.

To allow the sale to proceed regularly, a condition that must be included in the offer (to protect the proposer) is the compliance of the property with building, urban planning, and cadastral regulations, as well as the absence of liens, easements, debts, or legal disputes related to it (condominium, tax matters, etc.). Alternatively, the seller must undertake to resolve any such issues before the final deed.

Other elements that must be indicated include:

• the proposed price
• payment methods
• the date of the preliminary sales agreement
• the date of the notarial deed

Additional conditions or opportunities for the seller may also be included if the proposer wishes.

For example, the offer may include the furniture already present in the property, or part of it. Alternatively, if the seller has particular needs communicated by the agent, the proposer may declare their willingness to take possession of the property after the notarial deed (naturally specifying the time limit).

3. How is the seriousness of the offer guaranteed?

Making a purchase offer, although simple, is still a significant commitment toward the seller.

For this reason, the buyer’s intentions must be confirmed with a non-transferable check payable to the owner, which is left with the agency and not delivered to the owner until the offer is accepted or an agreement between the parties is reached.

Once the agreement is reached, the owner may cash the check, and the amount will be counted as a deposit (caparra confirmatoria).

If a subsequent preliminary agreement is scheduled, the amount of the deposit will usually be supplemented with an additional payment.

This means that if the proposer fails to fulfill their commitments, they cannot request the return of the amount paid. On the other hand, if the seller withdraws from the agreement, they must pay double the amount received.

Alternatively, the non-defaulting party may take legal action to enforce the contract.

If the sale is successfully completed, the deposit paid will be considered an advance on the purchase price, which is usually at least 5% of the property price (a further 15% is generally paid as a deposit at the preliminary agreement; the percentage may decrease as the price increases).

Another way to guarantee the seriousness of the offer is to pay the agency a security deposit as a guarantee of the commission commitment. This amount can be counted toward the agency commission if the transaction is completed or returned if the offer expires without acceptance.

In this case, if the deal is concluded, the deposit is usually paid in a single installment at the preliminary agreement, after all checks on the property’s sale conditions have been completed.

Compared to the traditional deposit, this method allows better management of the relationship with the proposer if critical issues with the property emerge after the offer has been accepted and prevent the signing of the preliminary agreement. In such cases, the agency must return the deposit to the proposer.

4. What if I need a mortgage before buying?

Even in this case, things are much simpler than they might appear.

Clients often need a mortgage loan to buy a house, and this can sometimes seem like an insurmountable obstacle. In reality, it is simply a matter of seeking information and asking a real estate agent how to approach this step.

One piece of advice I usually give before submitting a purchase offer is to consult a credit mediation professional. By analyzing the client’s income capacity, the professional can provide the information and support necessary to manage the mortgage approval process.

If the consultation has a positive outcome, the purchase offer can be made with complete peace of mind.

Therefore, if you are looking for a home and need a mortgage, make sure you move on both fronts: visit properties and select the one that suits you best, but at the same time consult a credit mediation professional who will ensure that you are ready when you find the perfect property and can proceed confidently with your purchase offer.