What is it?
A firm offer is an offer with no conditions. You must buy even if your financing falls through or an inspection finds problems. The moment the seller signs and returns it within the irrevocable time, you have a contract with no way out.
The word “firm” is also used for the state of a deal. A deal that started as conditional becomes “firm” once every condition is fulfilled or waived. In both cases, from that point on you cannot simply walk away.
The Government of Ontario says there is no legislated cooling-off period (a set time to cancel without penalty) for a resale condo. A resale house is generally understood to have none either, but confirm this with your lawyer. Either way, with a firm offer every check must be done before you sign.
When does a deal become firm?
| Situation | When it is firm |
|---|---|
| Offer with no conditions | The moment the seller’s signed offer is delivered to the buyer’s side within the irrevocable time |
| Conditional offer | The moment the last notice of fulfilment or waiver is delivered in writing before its deadline |
| After sign-backs | The moment the last changed version is signed and delivered in time (and any conditions are then cleared) |
Once the deal is firm, the lawyers start the title search, mortgage paperwork and closing preparations. The deposit goes into the brokerage’s trust account at the time set in the agreement (usually right after acceptance).
Why make a firm offer?
Sellers like offers that cannot fall apart. With several competing offers, a firm offer can win even at a slightly lower price. That is why firm offers are common on sought-after homes in Toronto and the GTA.
But every condition you drop shifts that risk from the seller to you. RECO (the Real Estate Council of Ontario) warns that in a competition you may be tempted to spend more than you planned or to remove conditions that protect you, and advises setting your rules in advance and sticking to them.
The risks of a firm offer
- Financing: even with a pre-approval, the lender still appraises this specific home and does a final review. If the appraisal comes in below the price, the loan shrinks and you must cover the gap yourself. RECO says pre-qualifying for a mortgage (getting a rough estimate of how much you could borrow) does not safely remove the need for a financing condition. The same goes for a pre-approval.
- Condition of the home: without an inspection, hidden problems with the roof, foundation, plumbing or wiring that appear after closing are your cost. RECO calls skipping an inspection a significant risk a buyer must weigh carefully.
- Condos: without reviewing the status certificate, you may not know about a large special assessment, a lawsuit or a steep fee increase.
- Insurance: old wiring or an oil tank can make insurance hard or expensive to get, and lenders usually require home insurance.
- Sale of your current home: if it does not sell in time, you must carry both homes (for example with bridge financing).
- Life changes: a job, health or family change does not change the contract.
What you can do before dropping conditions
- Financing: get a pre-approval, and before the offer send the address and listing details to your lender or mortgage broker for an early review. Work out a cash buffer in case the appraisal is low. Remember this is still not final approval.
- Inspection: have the home inspected before you offer (a pre-inspection). If the seller provides an inspection report, remember that inspector was hired by the seller.
- Condos: review the status certificate the seller has already obtained with your lawyer before the offer. If it is old, ask for a fresh one.
- Insurance: get a quote for the address in advance to confirm you can be insured.
- The contract: show the draft offer to your lawyer, and nail down the included items and the closing date.
- Money: map out when and how you will have the deposit (right after acceptance) and the closing funds (rest of the down payment, land transfer tax, legal fees).
What if you cannot close a firm deal?
A buyer who does not close a firm deal has broken the contract. In general, the buyer can lose the deposit, and the seller can go to court for other losses (for example the difference if the home resells for less, plus extra costs). The actual outcome depends on the contract, the facts and the court, so always talk to a lawyer.
If the seller fails to honour a firm deal, the buyer can get the deposit back and claim losses.
If the two sides argue about who gets the deposit, the brokerage cannot release it without a mutual release signed by both or a court order. RECO’s deposit insurance does not cover such a dispute.
Firm offer vs. conditional offer
| Firm offer | Conditional offer | |
|---|---|---|
| Conditions | None | Financing, inspection, status certificate and so on |
| When it is firm | On acceptance | When every condition is fulfilled or waived |
| Way out | None (breach of contract) | If a condition is not met, end the deal by the deadline and get the deposit back |
| How the seller sees it | The strongest offer | An offer that could fall apart |
| Buyer’s risk | High | Protected by the conditions |
Example
Five offers come in on a Toronto semi. The day before the offer date the buyer pays for a pre-inspection at their own cost, sends the listing to the lender and hears that approval at this price is likely, and gets an insurance quote. The buyer then makes a firm offer of $1,180,000 with no conditions.
The offer is accepted and the $60,000 deposit is paid the next day. Two weeks later the lender’s appraisal comes in at $1,150,000, cutting the loan by $30,000, but the buyer covers it from the cash buffer planned in advance. Without that buffer, the buyer could have failed to close, lost the deposit and faced a claim for damages. The amounts are only an illustration.
What the law and official sources say
Quotes are copied word for word. The "In plain words" lines are our explanation, not an official translation.
In a competing offer situation, you may be tempted to offer more for the property than you planned to and/or remove conditions from offers that are intended to protect you.In plain wordsIn a competition you may be tempted to pay more than planned or drop the conditions that protect you. RECO warns buyers to be careful.
Source: reco.on.ca/consumers/information-for-buyers/competing-offers/ · checked Oct 30, 2026
In competing offer situations, it can be tempting not to include a clause in an offer that makes it conditional on a home inspection. While your offer might be more acceptable to the seller, you may later learn that there are property defects, required repairs or needed upgrades that you weren’t aware of. … Foregoing a home inspection is a significant risk that a buyer needs to carefully consider.In plain wordsDropping the inspection condition may please the seller, but you may later discover defects and repair costs you did not know about. RECO calls skipping an inspection a significant risk to weigh carefully.
Source: reco.on.ca/consumers/information-for-buyers/competing-offers/ · checked Oct 30, 2026
Be aware that pre-qualifying for a mortgage does not safely eliminate the need for a financing condition in an offer.In plain wordsRECO means that being pre-qualified for a mortgage (a rough estimate of what you could borrow) is not a safe reason to drop the financing condition. Even with a pre-approval, the appraisal and final review of this home still come later, so the same caution applies.
Source: reco.on.ca/consumers/information-for-buyers/competing-offers/ · checked Oct 30, 2026
If you encounter a competing offer situation, enter with a strategy. Set ground rules in advance about what you want from a home, what you’re willing to spend and what conditions must be met. Once your rules are set, stick to them. When there are competing offers it can be tempting to waive your conditions (such as a home inspection). Think twice before doing this.In plain wordsBefore entering a competition, decide what you want, what you can spend and which conditions you must keep, then stick to it. RECO says to think twice before waiving conditions such as an inspection.
Source: reco.on.ca/consumers/information-for-buyers/buyers-checklist/ · checked Oct 30, 2026
there are no rules in place (in legislation) outlining a set time (“cooling-off period”) of when you can cancel your purchase without penaltyIn plain wordsA resale condo has no legal cooling-off period. That means once a firm offer is accepted, there is no set window to cancel without penalty.
Source: ontario.ca/page/what-know-before-buying-home · checked Oct 30, 2026
In the case of a dispute over ownership of a deposit, a brokerage can only disburse the deposit in accordance with the terms of a mutual consent and or release form signed by both the buyer and seller or by following instructions in a court order.In plain wordsIf a firm deal collapses and the two sides argue over the deposit, the brokerage cannot release it without a release signed by both or a court order.
Source: reco.on.ca/consumers/consumer-deposit-insurance/ · checked Oct 30, 2026
Common questions
Do I need a bigger deposit with a firm offer?
No law requires it. The deposit amount is negotiated separately from whether there are conditions. In a competition, though, buyers sometimes pair a firm offer with a generous deposit to make it look stronger.
With a pre-approval, is it safe to go without a financing condition?
Not safe. RECO says pre-qualifying for a mortgage (a rough estimate of what you could borrow) does not safely remove the need for a financing condition. A pre-approval is not final approval either. The lender still appraises this home and reviews your final documents. If you drop the condition, you need a cash buffer in case the appraisal is low.
What if I find a serious problem after the deal is firm?
In principle the contract stands. If the seller knowingly hid a latent defect or made a false statement, there may be a legal remedy, but that is a question for a lawyer. This is why a pre-inspection before a firm offer matters.
If I break a firm deal, do I only lose the deposit?
It may not stop at the deposit. The seller can also claim losses such as the difference on a resale at a lower price and extra costs. The actual outcome depends on the contract and the facts, so talk to a lawyer.
Can a deal that started conditional become firm?
Yes. Once every condition is fulfilled or waived within its deadline, the deal is firm. From the moment the last waiver is delivered, you are bound just as with an unconditional offer.
Guides that use this term
Sources checked
- RECO, Competing offers (for buyers) · checked Oct 30, 2026
- RECO, Buyer’s checklist · checked Oct 30, 2026
- RECO, Home inspections · checked Oct 30, 2026
- RECO, Consumer deposit insurance · checked Oct 30, 2026
- Government of Ontario, What to know before buying a home · checked Oct 30, 2026
- FSRA, Signing a Mortgage Contract (preapproval vs. mortgage contract) · checked Oct 30, 2026