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
Judy Szablak
With over 30 years in the industry, Realtor Judy Szablak has been on national television for her real estate expertise on the HGTV Network, featured on Martha Stewart Living Radio "Morning Living” , NPR radio as an expert real estate panelist, It’s Relevant News channel, and quoted in the Wall Street Journal for her in depth knowledge of Fairfield County Connecticut real estate.
She was also on the local NPR radio station (WSHU) as a Fairfield County CT real estate expert. Judy has provided multiple online respected news sources with her real estate expertise including The Daily Easton, The Daily Weston, The Daily Fairfield, The Daily Stamford and The Daily Greenwich, as well as in print in the New York Post. She is a weekly Real Estate Columnist for WestportNow.com, another real estate column "Real Estate With Judy” is syndicated through Hearst CT Media Online and seen in The Connecticut Post, The Danbury News-Times, The Stamford Advocate, The Greenwich Time, The Hour, Fairfield Citizen, Westport News, Darien News, New Canaan News and the Wilton Villager.
Judy is also the author of the book, The Art of Buying or Selling a Home, available at all major book retailers. Additionally, Judy has been nationally recognized in a number of national real estate trade magazines, some with distribution to over 1 million members. She was featured in Real Estate Today as early as 1994 for her commitment to, and implementation of technology in real estate. Judy appeared in the Certified Residential Specialist Magazine, as she provided advice on marketing strategies and ethics in the article titled "Marketing Makeovers.”
Judy was also featured in REALTOR® Magazine, regarding image enhancement for Realtors. She was again featured in REALTOR® Magazine, in an article on "Achieving Flow” and operating at optimal peak performance. In another article in the same publication, Judy offered guidance to fellow real estate professionals as she explored the topic of implementing and maintaining personal websites. She has appeared in The Council of Residential Specialists Magazine, which featured her ideas regarding technology. Additionally, Judy authored an article on marketing and technology for the Certified Residential Specialist (CRS) Online Magazine. On two occasions, in 2015 and 2017, she appeared as a featured agent in Top Agent Magazine. I have a few other websites- www.TheCtrealtyBlog.com www.CtHomesAndRealEstate.com www.BestWestportHomes.com www.ThePetitePowerhouse.com www,SzablakConsulting.com
