Ohio Real Estate Attorney
The right of “First Offer” is a legal obligation to allow a holder of the “right” to purchase a property asset before anyone else. A right of First Offer may be found in a will that would allow a sibling or relative to buy a property first or may be involved in a business disposition. If the holder of the right declines to exercise the right then the property can proceed to market and the right is retained and filed into escrow during the sale.
A right of First Offer may also appear in a lease agreement for commercial or residential property and allows the occupant to have the right to offer to retain the lease if the landlord opts to put it into the market.
When an owner wants to sell or lease a property, whether occupied or not, the holder of the right is notified and they can make the first offer to the seller. The seller is NOT obligated to accept the offer, even if it is above the market price the seller is looking for. The holder of the right typically has a set amount of time to provide the offer before the right expires. If the right expires, it is void.
A seller can sell the property to a third party after the right of First Offer is declined. In the event that the seller does not get a reasonable market price, they are not prohibited from returning to the right of First Offer holder, but the right is no longer valid nor is their initial offer.
A right of first refusal is a right that favors a buyer and gives them the right to match an offer made on a property. The right of First Offer gives the holder of the right the permission to make the initial offer on the property. So the holder of the right of first refusal would have to MATCH or beat the offer from the holder of the right of First Offer in order to win the property.
Rights of First Refusal are not common but may exist from a will or some other legal document associated with disposing of the assets of a deceased person. Typically, the Right of First Refusal and Right of First Offer move quickly with expiration dates on the offers of no more than a few days.
Short sales are a legal sale of a property when a property owner sells the property for less than the amount owed on the mortgage associated with the property. The buyer of the property is not the lender and the proceeds from the purchase all go to the lender.
A home sale Contingency Clause in a purchase contract protects the potential buyer of a property from carrying two mortgage payments when they own another property that they are attempting to sell.
The FSBO Escrow Process Can Be Managed in 7 Steps with the Help of Inspectors, Notaries and and Attorney.