Understanding Irrevocable In Real Estate
First, irrevocable is exactly what it sounds like, that the stipulations within the contract you are dealing with cannot "be revoked" until the "irrevocable time" stated in the contract has passed.
The most important issue to also understand with this concept is that the "irrevocable ownership," or rather the legal obligation to the contract only applies to the party whom is "submitting" the contract.
So for example, and in terms more specific to real estate if you as a buyer submit an offer to a seller with an irrevocable time of say 1PM, the seller has only 1 option to "complete" the contract. They can accept it as is, prior to the 1PM time deadline. You as the buyer and the party submitting the contract are therefore obligated to adhere to that contract.
To fully understand the real estate contract process, the seller also has 2 other options with that original contract.
They can do nothing and let the contract expire at 1PM, at which time you as the buyer are no longer obligated to be held accountable to the contract.
They can sign it back to you with changes to whatever areas of the contract they would like to be changed, such as price, closing date and any other conditions.
With option 2 above however a couple things have now changed.
1. The irrevocable timeline starts new and legal responsibility no longer resides with the buyer but now resides with the seller. The "submitting" party has now changed. With a sign back It's now the seller who is "submitting" an offer back to the buyer.
Since for all intents and purposes this is a brand new contract in play it is also important to understand that the sellers does not in fact have to send back their offer to the buyer before the original 1PM deadline as that time is no longer legally relevant. It can be "submitted" back from the seller to the buyer at any time.
2. Once the seller signs an offer back to the buyer and takes on the irrevocable legal responsibility they can also no longer accept any new incoming offers until the irrevocable time set in their sign back offer has expired.
The reason to have this sort of legal timeline in real estate contracts is to ensure that offers being submitted to property owners are legitimate and to allow reasonable time for these contract to be reviewed and fully considered by the receiving parties.
All of this back and forth can be a little bit tricky to understand that's why it's important to deal with a licensed and experienced REALTOR®. We're trained to understand the juggling act that is the irrevocable back and forth and to help you to make your best decision for your specific real estate buying or selling goals.
Aurora Real Estate. New Market Real Estate. Richmond Hill Real Estate. Bradford Real Estate. East Gwillimbury Real Estate, Oak Ridges Real Estate, King City Real Estate. Luxury Real Estate.