Definition of "Tender"

Paul Van Zandt real estate agent
Paul Van Zandt, Real Estate Agent Realty Professionals of Texas

A tender has several meanings in everyday discourse. Most generally, tender means a formal offer designed for acceptance with the anticipation of soliciting a response in return. Bidding means organizing a tender to sell and buying shares, stocks, valuables, or even private property. And, finally, a tender can refer to a legal and acceptable means of payment (credit card, cash, or check.)

What does tender mean in real estate?

The definition of tender real estate revolves around a value for another’s (typically bidders) acceptance. An example is making a bid at an auction market for real estate. A tender is, by all means, one of the unique ways to sell a house.

Listing agents can list real estate for sale by tender. Homebuyers can present their offers in a written form and sealed envelope before an established deadline. Compiling a tender document constitutes the official procedure to commence the process. Only after the tender’s deadline can the house seller open the offers in the company of the vendor’s lawyer and the listing agent.

Local real estate agents often recommend listing real estate by tender. Firstly, the property sometimes showcases particular features, making it challenging to put a genuine price tag on the real estate. Secondly, the seller might have a deadline to meet when selling the property. A third case is when a vendor doesn’t want to disclose what price they expect from buyers. Therefore, they wish to receive generous offers and accept the most profitable.

Tender in finance

A tender can refer to a bidding proposal for a particular project. Also, a takeover bid means accepting a formal offer. You may also encounter the act of tendering when financial and government organizations stage proposals for projects. Applications for these projects have to meet a specific deadline. In corporate finance, the term can cover such a process in which shareholders submit their shares to respond to a takeover or merger.

Similarly, you find a tender offer as a public offer. You can purchase a specific number of stocks or shares made accessible by stockholders, generally designed to take command over the issuing company.

What is legal tender?

Courts accept a legal tender as a valid form of payment (money) used to settle any monetary debt. Every jurisdiction can determine what counts as legal tender. However, anything is accepted as tender if it meets the debt when tendered (offered.) The act of tendering the repayment in a legal tender for the debt nullifies one’s financial obligations.

According to the law in effect: “United States coins and currency (including Federal reserve notes and circulating notes of Federal reserve banks and national banks) are legal tenders for all debts, public charges, taxes, and dues. Foreign gold or silver coins are not legal tenders for debts.— 31 U.S.C. § 5103” (Source: Legal tender | U.S. Code | US Law)

 

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