As you tour a potential new home, you notice that the carpeting in the livingroom is stained. "Don't worry about that," says the homeowner, who senses your disapproval. "We're going to get the
carpeting professionally cleaned before we move."

Should you take their word for it?

Regardless of how honest a seller may seem, never rely on a verbal promise.

Will they move that abandoned car in the back yard? Will they fix the crack in the front steps? Is that expensive-looking ceiling fan included with the house?

Don't assume.Get it written into the offer.

You find a home that you're interested in buying. But you have concerns. Is it in a good state of repair? Will you be able to secure the right financing? Can you sell your current home in time?

Any of these issues can prevent you frommaking a prompt offer and, as a result, cause you to lose the opportunity.

The solution? Make a conditional offer.

A conditional offer means just that. You offer to purchase the home so long as certain conditions,which you specify,are satisfied. Here are the most common examples:

• "Subject to financing".You will buy the home if you're able to arrange for a suitable mortgage.

• "Subject to inspection". You will buy the home if it passes inspection by a qualified home inspector of your choice. If he or she finds that substantial repairs are required, you can either walk away from the deal or renegotiate.

• "Subject to selling my current home". You will buy the home if you can sell your own home within a set period of time.For example:45 days.A sellermight agree to this if your home is competitively priced.

• "Subject to the repair of ____ ". You will buy the home if the seller makes certain repairs, at his or her own expense. This can range from something relatively minor, such as fixing a crack in the foundation, to a major repair like
replacing the roof shingles.

A conditional offer will protect you.However, there is always the risk that the seller will say "No." If you're in a competitive situation, for example, and another buyer's offer is unconditional, you may lose the deal - even if your offer price is higher!

So you really need to use conditional offers strategically, in just the right way, under just the right circumstances.

OTTAWA -- The federal government is ready to clamp down further on mortgage rules if the boom in the Canadian housing market turns into a bubble, says Finance Minister Jim Flaherty. In an exclusive interview with Canwest News Service and Global National, Mr. Flaherty said the government is closely monitoring the redhot housing market for signs that it is reaching "irrational" levels. "The reality is we have low mortgage rates . . . so we can expect some upward pressure on housing," he said. "That's OK, as long as it doesn't become a bubble. We're watching that." If you are procrastinating buying a home read this article; Flaherty Impact.pdf (301.17 kb)