Trulia Guides
When all of your house hunting leads you the perfect home, it’s time to get down to business. To make an Offer on a house is no a small thing—after all, it’s one of the biggest purchases you’ll make in your life—so it’s important to know what you’re doing.
Luckily, there are tools and experts to help you understand the fair value of yourfuture home, deal with your finances, make your offer more compelling, and protect your money. From down payments to contingencies, escrow accounts to counter offers, here’s a step-by-step guide to understanding the process, enlisting expert help and figuring out how to make an offer on a house you love.
1. Do your local market research.
Start by researching local selling prices for homes comparable to the one you’re looking to buy. This will give you an idea of the fair market price. Also, check the history of the property — when the seller purchased it, and for how much. A seller who bought a home several years ago and has seen some appreciation in its value may be more willing to negotiate on price than a homeowner who purchased a home more recently.
If you are working with a real Estate agent, which we highly recommend, ask for his or her input on what you should offer. Your agent should have extensive knowledge and experience on comparable home transactions and the best offer strategy for the particular home you’re interested in.
2. Get pre-approved by a lender.
Unless you’ll be offering to pay cash for a home (and few of us can), you’ll need to take out a mortgage—and sellers often want to be assured that you can get one. When you are pre-approved by a lender before you submit your offer, you have a guarantee that they are willing to lend you a certain amount under specific terms and conditions. A seller will take an offer from a buyer who’s been pre-approved more seriously than one who hasn’t.
3. Seek guidance from your real estate agent.
With so many moving parts in a real estate transaction (and so much confusing terminology), you’d be smart to get the assistance of a real estate agent and a real estate attorney to protect your interests. You also want to make sure that your written offer meets legal requirements. These requirements vary state from state—there’s no universal contract.
An offer can be presented in what’s called a “Purchase Agreement.” This document should include: the date of the offer, the address and description of the property, the price offered for the home, finance terms (loan details, the amount of the deposit/down payment), escrow details, closing date, possession date, and any contingencies (clauses that allow a buyer to cancel a contract without penalty).
You may want to include contingencies like the right to have the home appraised and inspected, or making the offer contingent on the buyer obtaining financing and acceptable results of a home inspection.
You should fully understand your offer before signing it, so discuss with you any questions or concerns you may have about your contract with your lawyer.
4. Protect your money in escrow.
Your purchase agreement should note how much you’re willing to offer for a down payment.
Arrange to have the deposit held in an escrow account (not with the seller), so that your money can be returned to you if the offer falls through. If the offer is accepted, the deposit will be deducted from what you owe the seller at closing (when the sale is finalized).
5. Seal the deal.
When you’re ready, deliver the offer to the seller or to the seller’s real estate agent. Then it’s up to them. The seller may be deciding to accept the offer, reject it outright, or submit a counteroffer.
If the seller makes a counteroffer, he or she will suggest changes like a revised sale price or possession date. You can accept the counteroffer or submit one of your own. This process will continue until the seller and the buyer mutually agree, or until the offer is rescinded. Once an offer is accepted by both parties and signed, it becomes a binding contract, so it’s imperative that you work with your lawyer throughout the process and understand the offer’s contents fully before signing.
My name is Scott Grebner and I have been helping my clients realize their own personal real estate dreams. Real estate is a relationship-based business that works best when client relationships are built on trust and confidence. My goal is having clients be completely satisfied with the professional and caring service they have received.
The role of technology is rapidly changing how the real-estate market functions in this country today. Re/Max Preferred Choice is embracing these new mediums of communication to better serve our customers. We have created our company to better place important information in your hands to help you with your housing needs. For a personal consultation please contact me at my Website.
It seems that the dream of past generations was to pay off a mortgage. The dream of today’s young families is to get one. I would love to hear from you, about your Real Estate Dreams and questions.
When all of your house hunting leads you the perfect home, it’s time to get down to business. To make an Offer on a house is no a small thing—after all, it’s one of the biggest purchases you’ll make in your life—so it’s important to know what you’re doing.
Luckily, there are tools and experts to help you understand the fair value of yourfuture home, deal with your finances, make your offer more compelling, and protect your money. From down payments to contingencies, escrow accounts to counter offers, here’s a step-by-step guide to understanding the process, enlisting expert help and figuring out how to make an offer on a house you love.
5 steps to make an offer on a house
Start by researching local selling prices for homes comparable to the one you’re looking to buy. This will give you an idea of the fair market price. Also, check the history of the property — when the seller purchased it, and for how much. A seller who bought a home several years ago and has seen some appreciation in its value may be more willing to negotiate on price than a homeowner who purchased a home more recently.
If you are working with a real Estate agent, which we highly recommend, ask for his or her input on what you should offer. Your agent should have extensive knowledge and experience on comparable home transactions and the best offer strategy for the particular home you’re interested in.
2. Get pre-approved by a lender.
Unless you’ll be offering to pay cash for a home (and few of us can), you’ll need to take out a mortgage—and sellers often want to be assured that you can get one. When you are pre-approved by a lender before you submit your offer, you have a guarantee that they are willing to lend you a certain amount under specific terms and conditions. A seller will take an offer from a buyer who’s been pre-approved more seriously than one who hasn’t.
3. Seek guidance from your real estate agent.
With so many moving parts in a real estate transaction (and so much confusing terminology), you’d be smart to get the assistance of a real estate agent and a real estate attorney to protect your interests. You also want to make sure that your written offer meets legal requirements. These requirements vary state from state—there’s no universal contract.
An offer can be presented in what’s called a “Purchase Agreement.” This document should include: the date of the offer, the address and description of the property, the price offered for the home, finance terms (loan details, the amount of the deposit/down payment), escrow details, closing date, possession date, and any contingencies (clauses that allow a buyer to cancel a contract without penalty).
You may want to include contingencies like the right to have the home appraised and inspected, or making the offer contingent on the buyer obtaining financing and acceptable results of a home inspection.
You should fully understand your offer before signing it, so discuss with you any questions or concerns you may have about your contract with your lawyer.
4. Protect your money in escrow.
Your purchase agreement should note how much you’re willing to offer for a down payment.
Arrange to have the deposit held in an escrow account (not with the seller), so that your money can be returned to you if the offer falls through. If the offer is accepted, the deposit will be deducted from what you owe the seller at closing (when the sale is finalized).
5. Seal the deal.
When you’re ready, deliver the offer to the seller or to the seller’s real estate agent. Then it’s up to them. The seller may be deciding to accept the offer, reject it outright, or submit a counteroffer.
If the seller makes a counteroffer, he or she will suggest changes like a revised sale price or possession date. You can accept the counteroffer or submit one of your own. This process will continue until the seller and the buyer mutually agree, or until the offer is rescinded. Once an offer is accepted by both parties and signed, it becomes a binding contract, so it’s imperative that you work with your lawyer throughout the process and understand the offer’s contents fully before signing.
My name is Scott Grebner and I have been helping my clients realize their own personal real estate dreams. Real estate is a relationship-based business that works best when client relationships are built on trust and confidence. My goal is having clients be completely satisfied with the professional and caring service they have received.
The role of technology is rapidly changing how the real-estate market functions in this country today. Re/Max Preferred Choice is embracing these new mediums of communication to better serve our customers. We have created our company to better place important information in your hands to help you with your housing needs. For a personal consultation please contact me at my Website.
It seems that the dream of past generations was to pay off a mortgage. The dream of today’s young families is to get one. I would love to hear from you, about your Real Estate Dreams and questions.
