What Does under Offer under Contract Mean

As a prospective homebuyer, you have probably heard the terms “under offer” and “under contract” being used interchangeably. While both terms indicate that a property is in the process of being sold, there are differences between the two.

What does “under offer” mean?

When you see a property listed as “under offer,” it means that the seller has accepted an offer from a buyer, but the sale has not yet been completed. At this stage, the property is technically still available for purchase, as the sale is not legally binding. Typically, the buyer will have a set amount of time (usually around 28 days) to carry out due diligence, arrange finances, and complete any other necessary steps before the sale becomes legally binding.

What does “under contract” mean?

On the other hand, when a property is listed as “under contract,” it means that the sale has been legally agreed upon and is in the final stages of completion. The buyer has already satisfied all necessary conditions, such as obtaining financing and arranging for inspections and appraisals. Once all the conditions have been met, the sale becomes legally binding, and the property is considered sold.

Why do properties go under offer or under contract?

In a competitive housing market, many properties may receive multiple offers from interested buyers. In this case, the seller may choose to accept an offer, even if there are still steps that need to be taken. This is where the term “under offer” comes in. The seller has accepted an offer, but the sale has not yet been completed.

Once all the necessary steps have been taken, the property is considered “under contract.” This means that the sale is legally binding, and the property will soon be transferred to the buyer.

What happens if a property goes under offer or under contract?

If you are interested in purchasing a property that is listed as “under offer” or “under contract,” it is still possible to make an offer. However, the seller may not accept your offer, as they have already accepted an offer from another buyer. In some cases, if the initial sale falls through, the property may become available again, and you may have another chance to purchase it.

Conclusion

In conclusion, while both “under offer” and “under contract” indicate that a property is in the process of being sold, the latter is the final stage of the process, where the sale becomes legally binding. As a homebuyer, it is important to understand these terms and the implications they may have on the purchase of your dream home.