Okay, let’s imagine we want to buy a house. First of all: you need a purchase offer.
The purchase offer is an important step in the negotiations for buying a house through a real estate agency.
The offer is like saying, “Hey, I want to buy this house at this price and with these conditions.”
– It must be clear and complete: price, timing, conditions, and how you wish to pay with the money from a deposit in your bank (cash buyer) or with a mortgage.
– It’s irrevocable for a period of time. You can’t say, “Oops, I’ve changed my mind” until the deadline.
– If the owner doesn’t accept within that period, the offer becomes invalid. The end.
– If they do accept though, you can’t back out, or you lose your deposit.
The Confirmatory Deposit: A Sign of Seriousness
Now, to show we’re not kidding, we give a confirmatory deposit.
In practice: a sum of money as a guarantee, which serves to demonstrate how serious we are about the purchase.
The effects? Well, they’re important, because real money is at stake:
If the buyer changes his mind, he loses the deposit.
If the seller changes his mind, he must return double the amount.
Alternatively, he can ask for foreclosure or compensation for damages.
So the deposit isn’t just a down payment; it’s a concrete commitment that binds the two parties.
How it works in practice
Normally, the deposit is handed over to the real estate agent.
The agent keeps it safe, usually via a cashier’s check, assegno circolare, (useful in the event you wish to condition your offer) and, more rarely, via a bank transfer directly to the seller.
Please note that the check is made out to the seller, so the estate agent can’t use it for his own account.
He delivers it only when everything is confirmed, that is, when the deal is actually closed.
The moral of the story
The offer is serious and binding.
The deposit is the guarantee that no one is joking.
The agent is the neutral custodian of the money until the deal is closed.
If you follow these rules, real estate negotiations become much safer and more predictable, and everyone knows where their money is.