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Making a subject-free offer

A subject-free offer drops the conditions that normally protect you, and in exchange it is the most certain offer on the table. BC gives most home buyers one narrow exit, a 3-business-day rescission period that costs 0.25% of the price. The safe way to go subject-free is to do the homework before you write.

What “subjects” are

Subjects are conditions you attach to an offer that must be met before the deal becomes firm. If one is not met, you can walk away on the terms of your contract. The usual ones:

  • Financing. Your mortgage is approved for this home.
  • Inspection. The home checks out.
  • Strata documents. For a condo or townhouse, the depreciation report, minutes and finances look sound.
  • Sale of your home. Your current place sells so you can complete.

A subject-free offer has none of these. The moment the seller accepts, the deal is firm.

What you gain, and what you give up

You gain strength: a seller weighing several offers can pick the one with nothing left to fall through. That certainty can beat a slightly higher offer that still carries conditions.

You give up your safety net. If your mortgage falls through you are still committed. A hidden defect becomes your problem. A special assessment you did not see lands on you. The buyer due diligence checklist lists what the subjects would have checked.

The rescission period

The Home Buyer Rescission Period lets the buyer of a covered home back out within 3 business days after the acceptance is signed, for any reason, and it cannot be waived. It applies even to a subject-free offer. It took effect on January 3, 2023.

It is not a free do-over. You pay the seller 0.25% of the purchase price, which is $2,500 on a $1,000,000 home. If a deposit was paid, the fee comes out of it and the rest goes back to you.

Covered property. A detached or semi-detached house, a townhouse, an apartment in a duplex or multi-unit dwelling, a residential strata lot, a manufactured home affixed to land, and a cooperative interest that includes a right to occupy a dwelling. Leased land, leaseholds, auction sales and court-ordered sales are not covered.

The notice. Serve written notice on the seller. It names the property, the seller and the buyer, is signed, and carries the date. Registered mail, fax, or email with a read receipt to the seller’s address in the contract counts as served when sent. The rescission calculator works out your last day.

The closing timeline shows the rescission days against the other dates.

How to go subject-free without flying blind

Do the things the subjects would let you do after acceptance, before you write.

  1. Get fully underwritten financing. Go beyond a pre-qualification to a commitment for this home, so the money is in place before you give up the financing subject.
  2. Inspect before you write. Where the seller allows it, arrange a pre-offer inspection, or attend one from an earlier showing. This replaces the inspection subject with knowledge.
  3. Review the strata documents in advance. For a condo or townhouse, read the depreciation report, recent minutes and financials before writing. The strata-document subject would otherwise protect you here.
  4. Know the Home Buyer Rescission Period. You have 3 business days after acceptance to rescind for any reason, for a 0.25% fee, if the property is covered. Confirm that it is.
  5. Decide on purpose. With the work done, weigh how competitive the situation is against the protection you are setting aside.

Common questions about subject-free offers

  • What does a "subject-free" offer actually mean?
    An offer to buy can carry conditions, called subjects in BC, that must be met before the deal becomes firm. Common ones are financing, inspection, review of the strata documents and the sale of your current home. A subject-free offer has none, so the deal is firm the moment the seller accepts. That certainty is what a seller values, and what costs you the usual ways out. The one exit that remains is the Home Buyer Rescission Period. Source: Property Law Act, chapter 377 of the 1996 revised statutes, s. 42 (bclaws.gov.bc.ca).
  • Isn’t there a cooling-off period that protects me?
    Yes, a narrow one. The buyer of a covered residential property may rescind within 3 business days after the acceptance is signed, for any reason, even on a subject-free deal. The right cannot be waived. The buyer pays the seller 0.25% of the purchase price, which is $2,500 on a $1,000,000 home. Three business days seldom covers financing or a first inspection, so treat it as a last resort. Source: Home Buyer Rescission Period Regulation, BC Reg 175/2022, ss. 4, 6 and 7 (bclaws.gov.bc.ca).

    The right took effect on January 3, 2023. Business days leave out Saturdays, Sundays and every day the Interpretation Act, s. 29, calls a holiday. That list includes Easter Monday and December 26, and it does not include a Monday given in lieu of a holiday that fell on a weekend.

    Counting starts the day after the acceptance is signed and ends at 11:59 p.m. on the last business day. An offer accepted on a Friday gives you until 11:59 p.m. on Wednesday, with no holiday in between.

    Four kinds of sale are outside it: property on leased land, a leasehold interest, a sale at auction, and a sale under a court order or court supervision. A presale under a disclosure statement is outside it too. A presale buyer has a separate seven-day right under the Real Estate Development Marketing Act. The right also ends once title transfers to you.

  • Why would anyone make a subject-free offer?
    To compete. A seller weighing several offers can prefer one with nothing left to fall through, because an offer with conditions can still fail on financing or inspection. A subject-free offer can be what gets you the home. The aim is to make one only after you have done the work the subjects would have let you do, so the risk you take is chosen and not blind. Source: Property Law Act, s. 42; BC Financial Services Authority, Home Buyer Rescission Period (bclaws.gov.bc.ca, bcfsa.ca).
  • How do I make a subject-free offer without flying blind?
    Do before writing what the subjects would let you do afterwards. Get fully underwritten financing, not a quick pre-qualification. Arrange a pre-offer inspection where the seller allows it, or attend one from an earlier showing. For a condo or townhouse, read the depreciation report, minutes and financial statements in advance. Then decide on purpose, knowing the one exit you keep. Source: Property Law Act, s. 42, and Home Buyer Rescission Period Regulation, BC Reg 175/2022, ss. 2 to 4 (bclaws.gov.bc.ca).
  • What are the real risks if it goes wrong?
    Serious ones. If your financing fails on a firm deal you are still bound to complete. Failing to complete can put your deposit and further claims by the seller at risk, depending on the contract. A defect an inspection would have found becomes yours, and so does a strata special assessment you did not see. Your lawyer can tell you exactly what your contract says. Source: Home Buyer Rescission Period Regulation, BC Reg 175/2022, s. 6 (bclaws.gov.bc.ca).
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Also drawn from: BC Laws, BC Financial Services Authority.

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Last reviewed by Bronson Job PREC, REALTOR®. Licence CC BY 4.0. How we verify.

I’m Bronson Job, a REALTOR® (PREC) with Momentum Realty Inc., so I earn a commission when I help someone buy or sell. This is general information, not advice on your situation, and I take no payment from any third party named here. How I verify.