Home buying process - Making an offer on a home
Your offer to purchase
When you are ready to make an offer to purchase a home, you and your REALTOR® prepare a sales contract. Your REALTOR® then insures it is presented to the seller.
There are several components of your purchase and sale agreement. These include:
The price you are willing to pay,
A legal description of the property,
Your down payment,
Your mortgage amount with the maximum interest rate you will pay, the amount of earnest money,
A closing date,
A possession date,
Any personal property to be conveyed in the home,
The date the offer expires, and
Type of financing you are seeking.
You may also want to include special contingencies in your offer. A contingency requires a certain act to be performed in order for the contract to take effect. Some of the more common contingencies are home inspection, clear title, acceptance of Homeowner’s Association covenants and declarations, financing, repairs, environmental concerns, hazard insurance and appraisals. There are many other contingencies you may want to consider. Ask your REALTOR® to help you decide the contingencies you should select.
After you make an offer on a home, the seller can accept, reject, or make a counter offer. A counter offer is a response back from the Seller modifying the original terms of the offer which as the buyer originally made on the property. Your REALTOR® will be the one to relay the seller’s response back to you.
If the seller rejects or counters your offer, you may decide to pursue the purchase further by making a Buyer’s Counter offer. Your REALTOR® will help you with your counter offer. It is best that your negotiations with the seller be in writing using counter offer or sales addendum forms.
Before you accept any counteroffer, you should carefully review all changes to the contract which may include additional mortgage financing.
A home warranty may be purchased prior to closing, but paid for during the closing process.
Home warranties are available through a variety of companies and may be purchased for you by the seller or can be negotiated with the offer to purchase. Home warranties typically cover the mechanical components of your new home for a full year after purchase. The home warranty can help provide the comfort that you won’t be facing major expenses for heating, cooling, water heater replacement, etc. right after you move in. Ask your REALTOR® about obtaining a home warranty and the full advantages.