Almost every offer in London and St. Thomas is either conditional or firm, and the difference decides how much risk each side carries until the deal is done. Here's how it works, from both sides of the table.
Writing or Reviewing an Offer?
I will help you set conditions that protect you without weakening your offer
548 490 4577What are the common conditions?
| Condition | What it protects | Common length locally |
|---|---|---|
| Financing | The buyer getting mortgage approval on this property | 5 business days |
| Home inspection | The buyer being satisfied with the home's condition | 5 business days |
| Status certificate review | The buyer's lawyer reviewing a condo's finances and rules | 2 to 5 business days |
| Insurance | The buyer getting home insurance on reasonable terms | 2 to 3 business days |
| Sale of the buyer's home | The buyer selling their current home first | 30 to 60 days, with an escape clause |
Every length is negotiable. Rural homes that need well and septic tests often need longer.
What happens to the deposit?
In Ontario the deposit is usually due within 24 hours of acceptance and is held in trust, normally by the listing brokerage. If a condition isn't met and the agreement ends, the deposit is returned, usually once both sides sign a mutual release. On a firm deal, a buyer who walks away can lose the deposit and be sued for the seller's losses, such as the shortfall if the home resells for less.
How do you remove a condition?
When a condition is satisfied, the buyer signs a waiver or notice of fulfillment and delivers it before the deadline. Miss the deadline and, under the usual wording, the agreement ends. Don't waive financing because a pre-approval said yes. Wait for the lender's written commitment on this property, including the appraisal.
What is an escape clause?
A sale-of-home condition is a risk for the seller, whose home is tied up while the buyer tries to sell. An escape clause lets the seller keep marketing. If another acceptable offer arrives, the first buyer gets a set window, often 72 hours, to remove the condition or step aside.
When does a firm offer make sense?
Firm offers win in competitive markets because sellers value certainty. If you go firm, do the work first: a pre-offer inspection, a mortgage approval as close to final as your lender will give, and on a condo, a status certificate reviewed before you offer. In today's London market, with more listings than buyers, most sellers will consider conditions, so going firm is rarely necessary.
Sellers: comparing conditional and firm offers
A conditional offer at a higher price can be worth less than a firm offer at a lower one. Compare the deposit, the length of the conditions, the closing date and how prepared the buyer is, not just the price.
Frequently asked questions
Can a seller back out of a conditional offer?
Generally no. Once the seller accepts, they're bound by the agreement, and the usual conditions are for the buyer's benefit. Only the buyer can waive them or let them lapse. An escape clause is the main exception.
Can a buyer walk away during the conditional period?
If the condition is worded as satisfactory to the buyer in their sole discretion, the buyer can usually let it lapse. They still have to act honestly, and buyers have been held liable for using a condition as a pretext. Ask your lawyer if you're unsure.
How long is a conditional period in London?
Five business days is common for financing and inspection. Longer periods can be negotiated, especially for rural properties and for buyers who need to sell first.
