Understanding the process of making an offer on a house is very important. Making a great offer will help you in buying the home you dream of. A professional and well-experienced real estate agent will help you in this process. Investing in a home is a big financial commitment to ensure you have all the required details to make a wise offer.
Get Pre-Approved for a Mortgage
This is the first step to making an offer on a house, before getting pre-approved you must provide some information related to your income and credit. If the lender has started to review the numbers, you’ll get all the details like interest rate, closing cost estimates, monthly payment amount, and the purchase price you qualify for. You’ll also get your pre-approval letter.
Don’t forget to include your pre-approval letter when making an offer. Be sure that you’re getting a pre-approval and not a pre-qualification.
Find the Right Home for You
After pre-approval, start the home search that you’ve dreamed of. Start by browsing listings online, and setting up listing alerts on various real estate platforms. If you’re interested in a home, go deep and know about it.
- How long has it’s been on the market
- How long the current owner has lived there
- If it’s been renovated or expanded
- What the neighborhood is like
- The more you know about the property the better your offer will be.
- Calculate How Much to Offer on a House
- Fixing the right price can be a challenge, and there are a few things to consider.
Research the home and its history – It’s good to know how long the seller has lived or owned a home and how long it’s been listed can help you.
Know the local market and home comps – Gathering all the required sales data from other homes in the area will let you know what similar properties are selling for
Stick to your budget – Once you know your budget, stick to it. Be sure that you’re comfortable with your competitive offer.
Decide Your Earnest Money Offer
It’s an amount of up-front cash that comes from your down payment funds. The deposits of earnest money fall in the 1 to 2 percent range.
Consider Your Contingencies
This will help you not to lose your earnest money deposit or legal issues.
There are five types of contingencies:
- Home inspection
- Home sale
- Write Your Initial Offer
- The initial offer should include,
- Name of the seller
- Address of the property
- The purchase price you’re offering and down payment
- Earnest money deposit
- Any contingencies you’d like to include
- List of fees and closing costs
- A deadline to respond to the offer
- Check whether all the information is correct and nothing is left.
- Negotiate the Price
Once you’ve submitted the offer the seller can either select or reject it. If the offer is accepted, good! If not, start looking for another property. Use this experience to help guide your next offer.
Finalize and Sign the Contract
If you and the seller agreed, you’ll finalize the contract and sign it. Next, send the contract to your mortgage lender to continue the mortgage process.