Pexels The Option To Purchase is not something we think about often; at least until something goes wrong.
Then we’re making sobbing noises, begging for our lost deposit, and fuming about “how the stupid thing can work that way”.
prior to purchase although, in reality, sellers’ agents will likely give you the cold shoulder if you suggest anything longer than two months.The payment method, including the rest of the downpayment These issues should all be clarified with your lawyer, who will then send the OTP back with proposed changes.2.
The wording in the Offer to Purchase can, however, affect the subsequent Option to Purchase. The most famous example of this was in 2013, when an Offer to Purchase stipulated that the “option period” for a transaction should be “three days”., and the Chinese New Year break saw the OTP expire before it was exercised. Had the Offer to Purchase included the term “subject to contract“, that wouldn’t have happened.
“In cases where a significantly longer option or completion period is required, a common request from sellers are an increase in option fee or both option and exercise fees,” said Stuart Chng, Founder of Navis Living Group at OrangeTee.In many show flats, you may hear the term “reservation scheme”. This is to allow buyers to “chope” a unit, even if they don’t have immediate financing to buy it.
These schemes are okay if you need extra time while working out the sale of your existing home, already have loan approval but want to hunt for a lower interest rate, etc. But don’t put your money down if you’re not even sure you can get a loan, as you’ll still lose the deposit if you don’t exercise the OTP.If you cash the buyer’s cheque, you’ve accepted the OTP even if you haven’t actually signed.If you cash the buyer’s cheque, you’ve accepted the OTP even if you haven’t actually signed.
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