Friday, March 10, 2017

What You Need to Know Before Making a Home Buying Offer

Your home is likely going to be the greatest asset you have and what you can leave to your posterity. 

Once you decide upon the home that you want, your next step is to negotiate about what to include in the offer or purchase commitment.

 In most states, your Realtor will help you determine what to say or even say it for you. Some states may require an attorney to take part in the transaction.

If possible, ask your Realtor to let you see a blank copy of a purchase agreement when you first begin looking at homes. 

This is the document that you will present to the seller, and where you offer a price and any conditions you have for the purchase. That way, you will have time to think about what you want your agreement to cover. 

Be sure to include in your agreement a stipulation that the purchase depends upon a satisfactory professional inspection. If you have any doubts about the results of the inspection, ask for another one.

Here is What You Need to Know Before Making a Home Buying Offer:

1. Get recent selling prices of similar homes in the area to justify your offer price.

2. Be careful not to let your feelings rule. Remember, if the offer is turned down, there are (usually) other homes to your liking.

3. Do a background check on the property. How long has it been on the market? Why is it being sold? What are its good and bad points? Doing your homework will help you make an offer that meets the needs of both buyer and seller.

4. Check out the neighborhood and speak to neighbors.

5. Consider the home's resale value.

6. Negotiate about the offer price and other items to be covered in the offer before you sign any formal papers.

When your offer is formally accepted, you sign the purchase agreement which is a legal contract. It covers many items, such as the price, total down payment, and closing date. (The closing date is when you sign the closing or settlement agreement that officially makes the home yours. 

This date may change if all the necessary paperwork is not finished. The offer also states which party (buyer or seller) will pay for which settlement costs, the type of loan you are applying for, and the interest rate. 

Keep in mind that earnest money or a good faith deposit is required when the offer is accepted. This is a cash deposit towards the down payment and shows your commitment to buying the home. 

Ask your real estate agent how much money is needed for a deposit and use your pre-qualification certificate to back up your offer.

Again, to protect yourself, be sure that the purchase agreement is conditional. This means that you can cancel it if you do not secure the loan or if the inspection identified major problems that can't be corrected before closing.

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