While buying a home might seem as simple as paying the asking price, knowing the ins and outs of making offers is crucial to buyer success. Everything from the terms of your mortgage loan to eventual closing costs can affect the amount you spend on your home, and making the right offer can significantly affect your chances in a competitive market.
Here are some of the basics of making an offer on a house:
Find the right home for you
Start by searching online listings for properties to view, or book a tour with an agent. The more knowledgeable you can be about the property, its location and history, the more informed your offer will be. And don't forget, your real estate agent can use their expertise to guide you every step of the way.
Write your initial offer
When it's time to make your first offer, consult your real estate agent for help choosing a starting price. Consider your own budget as well as the local market, home condition and seller situation.
Decide your earnest money offer
An earnest money deposit is an upfront amount of money included with your initial offer on a house. It's used as a sign of good faith, and also a form of insurance for the seller in case you back out of the sale.
Typically, the expected amount for this deposit is between 1% and 3% of the home's purchase price. However, if you're in a highly competitive market, it can benefit you to offer up to 10%.
Consider your contingencies
A contingency is a provision in your offer which protects your interests in case the unexpected happens between your offer on a house and closing. This allows you to withdraw your deposit under agreed upon circumstances.
One standard contingency example is a home inspection contingency, which allows you to back out of the sale without loss if the inspection uncovers any major problems with the property.
Real estate agents can help you decide what contingencies could work best in your favor. Depending on whether you're in a seller's market or a buyer's market, some strategies might work better than others.
About the Author
Robin Anderson Real Estate
“My Passion is people and relationships and I promise to provide my clients with exceptional service tailored to their individual needs.” -Robin Anderson
Georgia native, Robin Anderson brings her passion for people and her love of homes to work for her clients. She and her husband, Andy, have been married for over 30 years and have two adult children, Ellen and Drew. They currently live in Fulton County, but Robin has lived and invested in properties throughout metro Atlanta as well as helped clients buy and sell. She has been integral to many real estate endeavors including designing and building several custom homes, remodeling homes, subdividing land, managing rental properties, and buying and selling properties. She spent her first 3 years in real estate working with a new home builder, and she has spent the last 6 years working with buyers and sellers in her own community. Robin is highly motivated but sensitive to the fact that buying and selling homes can be an emotional experience, so she makes it a priority to keep clients closely informed throughout the process and strives to produce quick results. She appreciates the opportunity to help her clients navigate the real estate process, and she aspires to deliver quality customer service that is both informative and positive. She is driven to provide outstanding service for her clients and she is focused on building successful and lasting relationships with her clients. This personalized service earns her enthusiastic referrals from clients she is pleased to call friends.Edit
