Offer to purchase versus option to purchase
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Transcript of Offer to purchase versus option to purchase
But what fits !
SMS: +65 9782 8606http://www.singaporehomeloan.net
Not just Cheap
Home Loans
Commercial Loans
Property Buying FAQ - Option to purchase versus Offer to purchase
www.PropertyBuyer.com.sg/mortgage
But what fits !
SMS: +65 9782 8606http://www.singaporehomeloan.net
Not just Cheap
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Commercial Loans
What is an option to purchase
• An option to purchase is a contract whereby the owner of a property (seller) grants the option to the buyer to buy his/her property at an agreed price within an agreed time period for an agreed fraction of the price (usually 1%).
• During this time period while the option is in effect, the seller cannot sell his/her property to another party.
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What is an Offer to Purchase
• Offer to purchase is also abbreviated to OTP, but this must not be confused with Option to purchase.
• Offer to purchase is offered by the Property Buyer to the owner (Seller).
• In layman’s term, it’s the buyer making an offer and signing an Offer to purchase to present it to the seller for consideration.
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A Non typical property buying process – Involving Buyer and Seller agents
Agent must show Buyer the Option to purchase document together with an Offer to purchase. (But this is normally not practiced)
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A typical property buying process – Involving Buyer and Seller agents
Why it won’t work at this moment?
•Currently, Seller agents are not sharing the commission instead favouring a direct customer walk in where they get full commission.•Buyer agent also have a hard time to convince the buyer that they should pay the buyer agent 1% or whatever agreed amount for buying a place.•In the case where seller agent is willing to share the commission (zero commission from buyer), buyer agent is hurried into making the property buyer commit into a deal.
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A typical property buying process – Involving Buyer and Seller agents
In short, the Buyer agent cannot fully protect and look after the interest of the buyers.
The buyer agent typically do not show you the Option to purchase contract format and make you make an offer without ever seeing an option to purchase. In case you do not agree to the terms of the option to purchase, you will most likely lose your 1% deposit for an offer to purchase.
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A typical property buying process – involving only the Seller agent
No Buyer agent present. Seller agent prepares Offer to purchase for buyer to sign and pay 1% deposit. However, seller agent does not normally show buyer the option to purchase document. (But they should)
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A typical property buying process – Involving only Seller agents
This is not in your best interests.•The seller agent will perhaps present you with an offer to purchase for you to commit a 1% deposit and sign it.•Seller agent use you to make an offer which may be below the owner’s asking price, but which they think can still close the deal. •If owner accepts deal, but adds additional terms and conditions onto the Option to purchase? Does the property buyer have a right to back out? If Property Buyer backs out, will he/she lose the 1% deposit?(It is better a regulatory body specify what can be written into these OTP contracts and widely circulate it for public knowledge)
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Property Buying guidance
•In short, many things can go wrong with property buying. With our help, you can reduce the errors and make property buying a safer activity.
•Property Buyer Mortgage Consultants are: -
Home loans and Commercial Loans experts that can help you in buying a new property as well as refinance a property.
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About Property Buyer Mortgage Consultants
• We are NOT property agents. We can be independent.• (If you wish, we may refer you to agents which we find honest.)
• Guide and help buyers with valuations and processes.• Help buyers find the best match bank loans.• Our services are free to you as we act a bit like
“Outsourced bankers” where we are paid a commission. (Banks save on payroll, while we are driven to help buyers. Win-win situation.)
But what fits !
SMS: +65 9782 8606http://www.singaporehomeloan.net
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Commercial Loans
Contact Property Buyer Mortgage Consultants (Business registration 200618162C)
Home loans and commercial loans for buying or refinancing.
Tel : + 65 6100 0608Sms: + 65 9782 8606
Email: [email protected]: http://www.SingaporeHomeLoan.nethttp://www.PropertyBuyer.com.sg/mortgagehttp://www.iCompareLoan.com
