Real Estate Offer and Acceptance Quiz

A proposition made by one party to the other, outlining the terms of a potential binding contract.

The process where both parties agree to the terms of an offer, turning it into a binding contract.

Occurs when an offeror cancels their original offer before it's accepted.

A written document outlining the key terms of a real estate deal.

A response to an offer where the receiver suggests changes to the initial terms.

The person who makes an offer.

The person who receives an offer.

The completion of the promises made in a contract.

A preliminary agreement for the sale of a property secured by a deposit from the buyer. It binds the seller to a good faith agreement to sell the property.

An offer is officially terminated when the offeror receives notification of acceptance, completing the contract.

The seller's response to an offer that indicates their willingness to proceed with the transaction as proposed.

A seller's response to an offer that doesn't agree to the terms but doesn't reject it either. The seller leaves the offer hanging without a decision.

It's the seller's responsibility to make informed decisions regarding offers, including acceptance, rejection, or counteroffer.

Real estate agents should present all offers received, even those they think their client will reject.

A seller may establish specific minimum criteria for offers they'll consider, which the agent should respect.

In addition to price, buyers should consider important factors like closing date flexibility and contingencies when making offers.

Agents should communicate a seller's options regarding an offer, including acceptance, rejection, counteroffer, or no response.

A new offer made in response to an existing offer, changing some of its original terms. This makes the original offer void.

The process of offering and counteroffering can continue until a mutually acceptable agreement is reached, or it can completely fall apart.

A counteroffer must be in writing to be valid. Oral agreements are not legally binding.

Once a counteroffer becomes a contract, it becomes an executory contract, meaning both parties are obligated to fulfill their promises.

A seller can withdraw a counteroffer before it's accepted. This is crucial if a better offer comes along.

A seller can accept multiple offers. One accepted offer is the main deal, and the other is a backup in case the primary deal falls through.

Back-up contracts are secondary agreements that become active only if the primary contract fails.

NAR guidelines require listing agents to disclose the existence of other offers to buyers, but not the details of those offers.

Counteroffers should be made in writing to all buyers simultaneously. It is unethical to counteroffer multiple buyers at once.

When a buyer submits an offer, the seller has the right to accept, reject, or counter the offer.

A property remains on the market during the negotiation process, meaning the seller can still accept other offers.

A counteroffer is a new proposal that effectively replaces the initial offer, and both parties are obligated to honor the final agreement.

Even though there are multiple offers on a property, the seller is ultimately responsible for choosing which one to accept.

Once an offer is accepted, the seller is obligated to sell the property to the buyer, and the buyer is obligated to buy it. Both parties must fulfill their commitment.

Multiple offers usually happen when there is high demand for real estate. It is a sign of a strong seller's market.

When a seller's home has multiple offers, the listing agent must present each offer regardless of the offer's terms.

A net sheet is a document that shows the potential profit a seller will receive from an offer after closing costs are factored in.

The seller is under no obligation to respond to any specific offer first.

A listing agent acts as an intermediary between the seller and potential buyers, facilitating offers and communication.

A seller's ultimate goal is to maximize their profit, which is the net amount they receive after deducting all costs.

When a seller receives multiple offers, their decision to accept one may involve a balancing act between maximizing profit and minimizing time spent in negotiations.

The listing agent's fiduciary duty is to act solely in the best interests of their client, the seller, and to present all offers truthfully and transparently.

It can be enticing to accept the first attractive offer, but patience can lead to better offers.

An offer to purchase a property is made by a potential buyer and includes detailed terms of the transaction, such as the purchase price, closing date, and any contingencies.

Once a seller officially accepts an offer, the listing agent's obligation to market the property ceases.

A listing agreement is a contract that outlines the terms of the relationship between a seller and a real estate agent.

The closing date is the day when the legal transfer of ownership takes place and the buyer officially becomes the new owner of the property.

Contingency is a condition or clause in a real estate contract that must be met before the deal can proceed.

The buyer's agent represents the buyer in a real estate transaction, helping them find a suitable property, make offers, and negotiate with the seller.

A letter from a lender stating the buyer is qualified for a mortgage, showing the seller the buyer is financially capable.

The amount of time a buyer has to back out of a deal after making an offer.

A situation where a buyer offers to buy a house at a specific price, contingent on the appraisal meeting that price.

A contract condition allowing a seller to stay in the home after closing for a limited time.

The act of quickly completing a property transaction after an offer is accepted.

The specific price a buyer offers to the seller for a property.

The ideal middle ground offer price that balances the buyer's budget and the seller's expectations.

The practice of informing the listing agent about other offers made by the buyer.

Conditions that can prevent a buyer from fulfilling their part of the contract.

The process of informing a listing agent of the buyer's enthusiasm for the property.

The seller's willingness to contribute towards the buyer's closing costs during the sale process.

The percentage of the purchase price a buyer pays upfront without taking out a mortgage.

The amount of time a buyer has to thoroughly review a contract and decide whether to accept the offer.

The agreement between the buyer and seller to exchange the property for a specified price.

A strategy used to create a sense of urgency and competition. All offers must be submitted within a set time limit and the seller then chooses the best one.

This technique involves the buyer offering a higher price contingent on another offer being received, essentially bidding against themselves.

A key element in negotiating an offer. Helps the buyer understand their financial obligations.

A powerful tool for buyers' agents. Provides the buyer with a clear picture of their overall expenses when making a real estate offer.

In multiple offer scenarios, buyers may have other options. It's crucial to understand their priorities and their potential willingness to withdraw.

The maximum amount the buyer is willing to pay for the property, even if competing offers increase the price.

A seller's decision to avoid offers with escalation clauses, preferring buyers to submit their highest price upfront.

The risk that a buyer may overpay due to competing offers, potentially fabricated to inflate the price.

The condition of an escalation clause that requires competing offers to be legitimate and verifiable.

Including a clause stating that the escalation clause expires on a specific date, preventing the seller from using it indefinitely.

Including a financing, inspection, or appraisal contingency to safeguard against excessive prices in an escalation clause.

When a buyer decides to cancel their offer before the seller accepts it.

A personal conversation with a client who has lost a bid, expressing empathy and reassurance about finding another suitable property.

Buyer's stress due to intense competition, emotional involvement, and limited control in multiple offer situations.

Seller's stress in choosing between multiple offers, juggling both financial and personal factors.

An offer exceeding the asking price, indicating buyer enthusiasm and commitment to purchase.

A shortened due diligence period agreed upon by the buyer, reflecting their strong interest in the property.

A larger deposit paid by the buyer to demonstrate their seriousness and commitment to purchase.

A persuasive letter accompanying an offer, expressing genuine interest and personal reasons for wanting the property.