What's the Difference Between an Offer and a Contract?

Reblogger Missy Caulk
Real Estate Broker/Owner with Missy Caulk TEAM

Ann Arbor buyers just because you write and offer doesn't mean you have a contract. 

Good post by Chris Ann Cleland explaining the ABC's. 

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Original content by Chris Ann Cleland VA License # 0225089470

What's the Difference Between an Offer and a Contract?

The language we use when talking about real estate transactions is important.  In fact, in some situations the difference in one single word used over another can be critical to understanding what is happening, or what is expected in a real estate transaction. 

You'll often see the word CONTRACT used when the word OFFER should be used.  There is a very big difference between the two words.  They are not interchangeable.  Real estate professionals know the difference, but so should you as a Buyer or Seller.

An OFFER is what a Buyer makes to a Seller, or vice versa.  It is all the terms under which the Buyer would like to purchase the property.  It has been accepted in writing by only one party, that one making the offer.

The Seller can counter-offer those terms, making changes and sending them back to the Buyer for review.  Again, if this were the case, the terms have been changed and the changes have only been accepted by one party.

You don't get to the point of CONTRACT until all parties all agreed to all the terms IN WRITING.

As a Buyer you make OFFERS on properties.  You do not write CONTRACTS.  You are putting forth the terms under which you would like a contract to exist.  When accepted by the Seller your OFFER will become a CONTRACT, but not until it is accepted in writing.  Knowing the difference can be critical when explaining a multiple offer situation.  If you said you were dealing with a Seller than had multiple CONTRACTS, you are dealing with a Seller who has agreed in writing to sell one property to multiple Buyers.  That is a nightmare.  If you are dealing with a Seller who has multiple OFFERS, you want to be the one the Seller signs and turns into a CONTRACT.  It can be a competitive situation, but is not screaming for one or more lawsuits. 

When a CONTRACT exists both parties to it have obligations to perform.  An OFFER has no such obligation until the terms of the OFFER are accepted by all parties.
 

 

Chris Ann Cleland, Associate Broker- Licensed in Virginia, GRI, SFR, Northern Virginia Short Sale Specialist. Affiliated with Long & Foster, 7526 Limestone Drive, Gainesville, VA 20155.  To contact Chris Ann, call 703-402-0037 or email chrisann@LNF.com.  Or you can visit her website:  www.nvarealestate.net.

Header is a combination of photos, taken by Chris Ann Cleland, of various listings and neighborhoods in the Bristow-Gainesville-Haymarket area. 

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Rainer
535,299
David Burrows
Classic Realty - Fairfax, VA
No Pressure, Just Seriously Devoted to Real Estate

This is a very good post to reblog and I'm glad you did. There is a difference between the two words.

Sep 24, 2011 10:49 AM #1
Rainmaker
230,521
Bob Hertzog
Summit Home Consultants - Phoenix, AZ
Designated Broker

Excellent reblog Missy! Its good to keep your clients informed with the real estate terms and how they are different from each other... it only shows how dedicated you are to your profession and as Ann Arbor Short Sale Agents. Thank you for sharing this. 

Oct 01, 2011 07:48 AM #2
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Katerina Gasset
Get It Done For Me Virtual Services - Wellington, FL
Get It Done For Me Virtual Services

Hi Missy. There is a big difference between the 2 and there is always the tendency to misuse each term. Thanks for reblogging this Missy. Buyers and sellers in Ann Arbor need to contact expert Ann Arbor Short Sale Agents like you Missy. 



Oct 01, 2011 09:03 AM #3
Rainmaker
260,646
Kim & Kristine Halverson
www.LiveWorkSiliconBeach.com, Santa Monica Real Estate :) - Santa Monica, CA
Realtors

Hello there Missy!Great choice in choosing a good blog.Thank you for making everyone informed with how the terms are different from each other.It is very understandable and I'm sure the readers are glad to be able to read this blog.Stay excellent on being Ann Arbor Short Sale Agent.

 

 

 


Apr 01, 2012 03:53 AM #4
Rainer
97,555
Stephanie Anson
Anson Properties LLC - Gainesville, FL

Missy, thanks for re-blogging this, it's basic information every buyer needs to know. Thanks for sharing your expertise as an Ann Arbor short sale agent!

Apr 10, 2012 11:12 AM #5
Rainer
384,085
Sidney Kutchuk
Property Management & Sales at REALTY WORKS TEMECULA, CA 92590 (951) 217-6745 - Temecula, CA
Property Management & Sales Experts 951-217-6745

Hi Missy,I agree with Stephanie here it is definitely something a buyer should know.Wonderful blog here ,very knowledgeable .You're definitely the best Ann Arbor Short Sale Agent. 

Apr 20, 2012 02:34 AM #6
Rainmaker
260,004
Debbie Harr
Homes that Click Realtors - Columbus, OH
Realtor Homes That Click, Worthington Ohio Homes

Hi Missy, Glad I got a chance to read this. Thanks for always informing us and Keep being the bes Ann Arbor Short Sale Agent.

Oct 19, 2012 12:18 PM #7
Rainer
71,755
Bas Panch
SCV Home Buyer - Valencia, CA

Very informative! I'm sure the readers are glad to be able to read this blog. Stay excellent on being Ann Arbor Short Sale Agent.

Oct 19, 2012 12:43 PM #8
Rainer
25,656
Debra Parker
Debra Parker Real Estate, Inc. - Stuart, FL
Realtor - Stuart Florida Homes for Sale

Hello Missy,
Good job for this blog, very informative, you definitely have the marketing skills to help us. Best wishes and continue beng Ann Arbor Short Sale Agent!

Oct 25, 2012 11:13 AM #9
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