Writing an offer on a house is a complicated process that can be done one of two ways. With an agent or without! Everyone thinks that the reason I advise that you write an offer with a real estate buyer agent is that I want you to write with me. The truth is that there is quite a bit of legalize that is wrapped up in writing an offer. It is a contract that is, once signed and ratified, legally binding. It’s important that you either know what you are doing or get an agent who does!
Elements Of An Offer
There are a number of different elements that are put into the offer from the beginning and with each element is a decision that the buyer will need to make. In each area, there are standards to go with many of these decisions so if you are a buyer and you don’t know what decision you should make consider asking your agent what the area standards are to help you make your decision.
Purchase Price: So the first decision is probably the hardest one to make. What are you going to offer as the purchase price for the home? Should you offer to ask or over asking? You will want to find a number that sits well with you so that no matter what you will not have any regrets. We call it finding the right price!
Earnest Money: The next question is your earnest money and your loan. How are you planning on paying for this home? Do you have cash in the bank or do you need a loan? How much are you going to put down for your earnest money? Are these funds available? The money is always a huge factor in a sale and you need to decide how much you are going to need a loan for and what types of loans you qualify for, as well as having about 1-10% tucked away for your earnest money. The percent is different in different areas so you will need to ask your agent what the standards are before you make your decision.
Contingencies: There are some items that the sale is, what we call, contingent upon. This means that if the house or the sale of the house doesn’t meet certain requirements then the buyer can back out without losing their earnest money deposit. Common contingencies are loan contingencies, inspection contingencies and
the sale of a buyer’s current home. Basically this would mean that you have a set date, as the buyer, that is a deadline and if you can’t get your loan approved or your house sold or if you find something terribly wrong with the house in the inspections you can back out without any penalties. If you release your contingencies and then back out you have forfeited your earnest money deposit.
Personal Property: This is a big one! Many transactional arguments could have been avoided if the buyer and seller had agreed to what personal property was going to remain in the home and what was going to be taken out. Not only that but many people don’t know the difference between personal property and real property which can make things confusing. Real Property transfers with the sale and is land and everything attached to it. Personal property belongs to the seller and does not transfer with the sale and it is everything that can be packed up and moved out on a truck basically.
There are more elements that go into writing an offer and of course, there is always a chance that there will be negotiations and counter offers and addendum and so forth but these are some of the key elements that go into writing an offer. If you have any questions about writing an offer on a home for sale or if you would like to search properties in your area call me and I will do what I can to help you with all of your real estate needs.
