Agents pushing for unconditional offers? NO WAY.

For any home buyer (particularly first home buyers), navigating open for inspections, section 32's and making an offer, it can be a confronting and confusing process.

What are you supposed to include in your offer?

Does a 'subject to' clause protect you?

What's this finance approval date my broker is telling me about and do I need to include it?

What happens if I don't pay the full deposit in time?

When do I need to complete my building inspection in time?

How do I get out of this if it all goes pear shaped? Or am I bound to go ahead?

So many questions come up when you've finally found a property you want to buy. The reality is that each of the above points matter.

It is not uncommon for first home buyers to be encouraged to make an unconditional offer to get their offer over the line. Be very clear. A real estate agent works for the seller. It is their aim to get the best possible price and best possible terms for their client (the seller). They are being paid to sell the property.

But as a buyer, making an offer without any conditions opens up a can of worms which could ultimately see you pay the price. An unconditional offer means that you buy that property no matter what. Even if the valuation come in short, even if your bank is not happy to move forward or approve the loan you need to settle on this property, your offer is unconditional. You have to move forward.

This is where your 'subject to' clauses are so important. They give you an out if things go wrong. Basic examples of these are 'subject to finance' and 'subject to building and pest inspection'. If these come back usatisfactory, you as the buyer have an out. Or at the very least, room to negotiate.

So how does the finance approval date come into it? While you may have included subject to clauses in your offer, there is a timeframe by which you must will be required to move forward with purchasing the property (regardless of whether you have completed your building or pest inspection or if the bank is yet to go unconditional on your loan. The inclusion of a 'finance approval date' and for that matter, what timeframe you choose, is therefore crucial.

The finance approval date on a contract is the date by which you can walk away from the contract if one of your subject to clauses comes up satisfactory. It can protect you as the buyer. Real estate agents likely hate them as the longer the time frame, the greater the period of time that you as the buyer could walk away and they then need to start the selling process again.

It is up to you as the buyer, however, to be aware of what you need to include in your contract. It is not the responsibility of the real estate agent to be kind to you or to guide you as to what to include in your offer (and to be frank, they would be delighted if you make an unconditional offer).

It is up to you, the buyer, to know your 'stuff' and to have received advice as to what you should and shouldn't do.

Get advice from a conveyancer about the legal wording and terms to include in your offer i (in addition to having a conveyancer look through the contract before you make the offer).

Speak to your mortgage broker about what date should be chosen as your finance approval date. Your broker can tell you what date you should include knowing how long your bank will take to turn around your loan to be unconditional.

While it is not impossible to have an unconditional offer work out, it doesn't always. And the stress that it can place on a would be buyer is immeasurable.

Save yourself the angst by knowing exactly what you need to include in your offer. Then let the rest take its course.

This article is general in nature and is not meant as personal advice. Please seek advice relating to your personal situation, needs and objectives to ensure that the decisions you are making are appropriate and correct for you.