When making an offer to buy a home, the subjects you should put in your offer are to protect your best interest.
“Subject to” clauses and conditions give you time to do your due diligence after your offer has been accepted. Adding subjects gives you a legitimate out if the property doesn’t stand up to due diligence. So it’s important to choose subjects that accurately represent the due diligence you intend to do.
The subjects you should include in your offer depends on your situation, property type and market area. For a typical housing purchase in Metro Vancouver, we’d expect to see between four and six commonly used subject clauses. For example, subject to; financing, inspection, title, disclosure statement, property insurance and strata document review (for condos and townhomes).
REALTORS® in BC access a standard forms library administered by the Real Estate Association. When preparing your offer, we’ll work together to add the subjects that represent and protect your best interests. The professional association provides the wording of standard subject clauses in addition to the offer contract forms. For more specific circumstances, we’ll access the Real Estate Association’s library for the extra subject clauses.
Subject clauses provide a way to get out of a contract, but they differ from homebuyers’ rights of unconditional rescission. Subject clauses will always have a due date, and if you don’t fulfill your subject by the date, you lose your chance to buy the property. In your offer, each subject clause has an intent for due diligence. If you can’t fulfill the conditions, with due diligence you’d fall back on cancelling the purchase. For example, subject to financing, your lender does their home assessment, but they won’t grant final mortgage approval. In this case, you’d rely on your financing subject to collapse the purchase because you can’t secure final mortgage approval.
