How Long Is a Real Estate Purchase Contract Good for

How long a home seller has to accept an offer can depend on the offer itself and the corresponding language in the purchase contract. Most contracts set a time limit, and some states have prescribed limits as well.

Keep in mind that the response you ultimately receive might not be an acceptance of your offer. The seller can make a counteroffer, or they might reject your offer outright. A delay from the norm could have a number of different causes.

Key Takeaways

• Purchase contracts determine the time a seller has to accept an offer.
• Some states set specific maximum timelines, while othes give loose guidelines.
• Counteroffers, delivery delays, and other complications could push back the timeline or restart the clock.
• A seller doesn't have to respond to an offer if they have no interest in accepting it.

A Timeframe Example: California

Form RPA-CA, California's Residential Purchase Agreement, stipulates that an offer will be considered revoked if it's not signed by the seller and delivered back to the buyer by 5 p.m. on the third day after the buyer signs it. A buyer can enter a specific date into the agreement or keep the default of the third day.

A purchase contract would expire at 5 p.m. on January 5 if it's dated January 2 but not received by the seller until January 3. It was valid for 72 hours, until 5 p.m. on January 5. Any money paid by the buyer, such as earnest money, would be promptly refunded.

Sellers often respond within one to three business days, even in states that don't have specific rules and guidelines.

Not all states provide for such specific rules, however. For example, this time period is "usually" two to four days in Texas, according to the Texas State Affordable Housing Corporation, at least unless the purchase contract states otherwise.

Some Exceptions to the Usual Rules

The timeframe is likely to be longer when a bank is selling a property. This could be the case with a short sale or due to foreclosure. Anticipate a minimum of two days in a foreclosure situation, and a month or more for a short sale.

Delays in Delivery

A buyer's agent should immediately deliver an offer to the seller's agent when the buyer has signed it. An agent who receives the buyer's signature on an offer on Thursday, but who waits until after the weekend before sending it to the seller, would be handing over an expired offer if it were subject to a three-day or 72-hour expiration date.

A buyer can also authorize an agent to accept delivery of the signed, accepted offer on their behalf. The offer generally won't be considered delivered until the buyer actually receives it if the buyer's agent's name isn't entered, and the appropriate box remains unchecked.

This additional time can push the contract into expiration, which is why many agents prefer to receive delivery on behalf of their buyers.

The Counteroffer

A counteroffer effectively restarts the clock, so a seller can issue a counteroffer to the buyer to circumvent the problem of an expired offer. The counteroffer might only extend the time of offer acceptance, but it might also include a change in terms of price.

This process can go back and forth indefinitely until an agreement is reached, or until one party or the other quits and ends negotiations.

The Outbid Offer

Sometimes, sellers want to wait a bit to see whether a better offer will come in. A seller might ask the buyer for more time to accept the offer in this case, or they might try to receive and decide upon another offer before the existing purchase offer has expired.

A seller whose home has been on the market for 60 days or more might want to concentrate on the offer at hand, however, especially if it's a good one. This can avoid missing a prime opportunity because homes typically become more difficult to sell the longer they're on the market.

Multiple-Offer Situations

A listing agent will generally advise buyers' agents to have their clients make their best possible offers in multiple-offer situations. They'll set a deadline by which this must occur, or the offer won't even be considered. All offers are then presented to the seller at the same time to avoid unnecessary delays.

When the Seller Doesn't Respond

Sellers don't have to respond to offers, even to say, "No, thanks," and sometimes they simply won't. This generally occurs because the offer is either extremely low or unreasonable contingencies are included. Sellers aren't legally obligated to respond to any offer.

Sellers generally don't want to be bothered with officially rejecting an offensive or unworkable offer when they have more than one on the table. They might feel that you're so far apart in terms that countering isn't worth the time and energy it would take.

Get an honest opinion from your agent as to how reasonable—or unreasonable—they think your offer was if you find yourself in that situation. You might already have an idea, because your agent might have warned you that the price you offered was particularly "low ball."

You might want to resubmit a new offer at better terms, if possible, if you hear nothing for an extended period of time and if you're not dealing with a short sale.

Frequently Asked Questions (FAQs)

How long does it take to close on a house after an offer is accepted?

Closing on a home typically takes 30-45 days. Several steps are involved, including scheduling your appraisal, getting your home inspected, getting approved by underwriting, and submitting any additional documentation your lender requests.

Can you withdraw an offer on a house?

If all parties haven't signed the purchase agreement, you can withdraw an offer on a house without any consequences. If you're contracted to buy a home, you likely offered an earnest money deposit. In that case, you can withdraw the offer and receive your deposit if it meets any of the contingencies in the contract. For example, if the home inspection uncovers significant defects, you can usually withdraw your offer as long as that was a contingency in your contract. If there isn't a contingency that covers your situation and the purchase agreement is signed, you may lose your earnest money deposit if you withdraw your offer. You could also face legal action.

Can a seller back out after accepting an offer?

If all parties haven't signed the purchase agreement, the seller can back out. Otherwise, the seller can back out if a contingency isn't met or the buyer agrees to let the seller out of the deal. Otherwise, the seller could face legal action for not completing the contract.

How Long Is a Real Estate Purchase Contract Good for

Source: https://www.thebalance.com/how-long-do-we-have-for-offer-acceptance-1798980

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