In NYC, an accepted offer is NOT legally binding. It's basically a handshake agreement that either party can leave if circumstances change, a red flag is uncovered, or for any/no other reason. It also means that another offer could come in that the seller decides is better than the original, and the buyer could lose the home.
(As a seller's agent you are legally bound to present all offers to the seller, whenever you receive one. This includes after a unit is already in contract, but accepting a new offer at that point would incur financial penalties).
So, as a buyer, you are trying to get as much information about the property as quickly as possible while the attorneys write up a contract. You'll confirm you absolutely want to move forward before putting down a big chunk of change. But you'll also try to do so before anyone else can swoop in.
This information comes from a few sources:
- Home inspection
- Offering plan filed with the Attorney General
- Building financial statements
- Board minutes
- A questionnaire completed by building management
- Dept of Finance, DOB, and HPD
Once it has all been collected, a buyer's attorney will review it and flag any potential issues, as well as go over the contract with the buyers line by line. If all looks good, the buyers sign and wire 10% of the purchase price to an escrow account. But that's not the end of it -- you aren't OFFICIALLY in contract until the sellers also sign and the attorneys distribute a fully executed contract. I have heard of buyers recently losing units after they sent the wire, because someone came in with a much higher offer at the 11th hour.
Why do you care though?
Well I kind of have to care because it's part of my job. Apparently many agents are really hands-off during this period, because it's mostly on the attorneys to handle. But I am not great at feeling in the dark when it's my deal to quarterback to the finish line (I'm so sorry to everyone who cares about sports).
But things do come up in the due diligence that can lead to a re-negotiation of terms, and if I don't have a clear understanding of what those things are (an open permit, an upcoming assessment, LL11), how can I help re-negotiate?
And, unlike attorneys, we agents are very keyed into what is happening with a specific micro-market and the even more specific property. An attorney who doesn't realize (or care) that you won a 12 way bidding war can lose the place for you by being slow. Whereas a badass attorney can
At the very least, your attorney should have your agent cc-ed on any due diligence that comes in that they're sending to the buyer. But, unfortunately, that's not always the case. So work with good ones! Whichever agent you choose to work with will have a bunch of recommendations for you.