Good day I have signed an offer to purch...

Asked by Alphine on 11-01-2016 13:52:50
Question posted in the Property Law category relating to Gauteng
Question value: R 200.00

Good day

I have signed an offer to purchase for a property. This is subject to sale of my current home at a price of R2.1M neg. The banks have granted me a larger loan facility than I required.

My question is do I have a right to turn down any offer that is below R2 050 000 on my home? Does the larger loan amount granted from the bank put me in a position where I am forced to accept a lower offer because I will still qualify for the finance?

I am of the view that although I wil still qualify for the finance, accepting any offer below R2 050 000 will have an impact on my personal finances and therefore I believe I am not forced to accept a lower offer.

If I really want, can I only accept an offer of R2.1M exactly?

Your guidance will be much appreciated.

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Answer to the Question

Posted by Att. Patrick on 11-01-2016 14:25:59
Hi there and thank you for your question,

Yes, you have the right to turn down any offer for your house which is less than the R2.1m asking price. The offer could be for R100 less than R2.1m, and you can turn it down.

Just because the bank has given you a larger loan does NOT mean that you have to buy the new house, even if you get a lower price for your current house.

The bank could have given you a R20m loan - enough to buy a new house 5 times over. If you don't sell your current house for the R2.1m asking price, then the suspensive condition in the new sale agreement is NOT fulfilled, and there will be no sale.

"I am of the view that although I wil still qualify for the finance, accepting any offer below R2 050 000 will have an impact on my personal finances and therefore I believe I am not forced to accept a lower offer." <-- this is perfectly valid and legitimate. We did that ourselves when we bought our second home. The bank offered us a higher bond, but we decided NO, we didn't want to push ourselves.

"If I really want, can I only accept an offer of R2.1M exactly?" --> YES, 100% you can.

The suspensive condition is always VERY strictly interpretated. You can stick to the absolute letter of the wording, since it can't be broken by the seller.

You can however agree to waive it - if you wanted.

If there is a part of the answer which you need more advice on, or clarity please continue in this same thread instead of opening a new question.

Att. Patrick

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Answer Accepted

This answer was accepted on 11-01-2016 14:35:38

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