Making an Offer
Here's what you need to understand about making an offer.
When you have found the house that meets your needs and maybe even realizes your dreams, you'll probably find yourself getting emotionally involved. Maybe you'll imagine moving your furniture in, planting flowers, or hosting your first big holiday party. The trick is not to get too attached prematurely. There are a number of steps you must take before you're holding the keys in your hand, and you need to think clearly and objectively at this point so that the offer you make is a realistic one.
Determining what you should offer. There are a number of factors that will affect the offer you make. You can rely on your Weichert Sales Associate to help you determine a home's value relative to others in the area. Together, you'll also consider the condition of the home, the demand for homes like it, how long it's been on the market and, of course, how much you really want it.
Think twice before you make a "low ball," offer. It will elicit a counteroffer from some sellers, but others may dismiss your bid outright. Your Sales Associate will advise you on ways to make your offer more attractive: for instance, a mortgage credit approval and flexibility on the closing\settlement can ultimately close the sale.
Rest assured that your WEICHERT, REALTORS®-Synergy Sales Associate is a neighborhood specialist, well trained in the techniques of negotiation. After helping you think through the issues to determine the best offer for you to make at the time, your Sales Associate is well qualified to negotiate on your behalf with your best interests in mind.
Written offer with deposit. Depending on the circumstances, your Sales Associate may strengthen your written offer by presenting it personally and describing your case to the seller in person. All offers to purchase real estate must be accompanied with a good-faith deposit. If your offer is accepted, your deposit is placed in an escrow account. If not, it will be returned to you.
If the seller counteroffers, you may agree to that price and terms, or make your own counteroffer. Once you and the seller agree, both sides initial the final price and terms shown on the agreement of sale.
The final purchase and sale agreement will be signed after the home inspection is performed and both the buyers' and sellers' attorneys have compiled and reviewed any terms and conditions with respect to the sale of the property. The purchase and sale agreement will specify the items in the home included or excluded in the sale, as well as any additional provisions either side wants to have as part of the contract. End dates for contingencies, such as for obtaining financing, are also filled in before the contract is signed.
Additional deposit. At the time of the signing of the purchase and sale agreement, an additional deposit will likely be paid to secure the contract and demonstrate a willingness to move forward with the transaction. As soon as the purchase and sale agreement is signed by both parties, your mortgage lender will order an appraisal of the property and your your attorney will order a title search and issue title insurance.
Mortgage contingency. Unless you are an all-cash buyer, as part of your sales contract, you generally will agree to obtain financing within a specified period. This period may be extended with the seller's agreement. If, after diligent efforts on your part, you are unable to secure financing, the contract may become null and void.
Home inspections. Buying a home may well be the largest financial investment you will ever make. Naturally you will want to know as much as possible about the property before you finalize the purchase at closing.
It's important to hire a knowledgeable, independent home inspector for advise on the overall condition of the property. The purchase contract usually requires specific time periods for each inspection, and it's critical that these time frames be met. Usually the cost for any and all inspections and re-inspections are paid by the buyer.
Some examples of common inspections are:
- Structural - Defects caused by poor construction, soil movement, water or drainage conditions, settlement, fire, etc.
- Environmental Hazards - Including asbestos, lead-based paint, radon gas or any other toxic material.
- Roof - Can include framing members, decking and shingle condition.
- EMP - Electrical, Mechanical and Plumbing - Should include electrical and plumbing systems, built-in appliances, heating and cooling systems, swimming pool/spas, sprinkler systems and security systems.
- Termite - Report would show any visible infestation or visible damage caused by and wood destroying organism (termites, water damage, wood rot).