Form-of-the-Week:

Counteroffer, and Rejection of Offer — Forms 180 and 184

The seller’s objectives encounter a buyer’s offer

On submission of a buyer’s offer to purchase a property listed with a broker for sale, the seller, with the assistance and advice of the seller’s agent, either:

  • accepts the offer on the terms submitted;
  • responds with a counteroffer to the terms submitted [See RPI Form 180]; or
  • rejects the offer without making a counteroffer, thus terminating further negotiations with the buyer submitting the offer. [See RPI Form 184]

The use of a counteroffer allows a seller’s agent and seller to take the reins of negotiations a prospective buyer has handed over when they submitted a purchase agreement offer. [See RPI Form 150]

For the seller’s agent, the counteroffer gives rise to the special duty to care for and protect the seller, which, includes:

  • addressing property disclosures the seller needs to make to perfect negotiations before the seller enters into a purchase agreement with the prospective buyer;
  • clarifying any uncertainties about the buyer’s financial ability to close escrow; and
  • reviewing different terms or conditions sought by the seller from those offered by the buyer.

Further, a counteroffer allows the seller’s agent to eliminate contingency provisions in the buyer’s offer regarding disclosures. Also, the seller’s agent takes steps to establish the buyer’s qualifications for any purchase-assist financing requirements and the source of other funds needed by the buyer to close the transaction.

The seller’s agent’s analysis
The diligent seller’s agent
Various responses to a buyer’s offer
Analyzing the counteroffer form
The counter is an offer
Counter to a counter
Rejecting an offer

rpi_180_counteroffer

 

rpi_184_rejection-of-offer