The Offer Process

Offers and Counter Offers:

So, you've found it - that perfect house that fits all your criteria and your price range and you're ready to make an offer! You and your real estate agent can discuss what is the best offer to make. Sometimes it is OK to make an offer that is lower than the asking price, but if you are in a hurry to buy, your heart is set on a house, or you know there are other offers on the table, you may want to offer the full asking price. Your agent can help you decide. Your agent will write up an offer and present it to the sellers agent or the seller with your terms and conditions. At this point you will want to make a down payment called earnest money.

Earnest Money:

Once you've determined your offering price you'll need to decide on the size of deposit to make with your offer. This earnest money deposit should show the seller you are serious, but not so large you are placing significant funds at risk because sometimes negotiations can take awhile and your funds are tied up during that time. Still it depends, like your offer, on the kind of market you are in and your agent should be able to help you decide the size of the deposit that is appropriate.

Negotiations:

Now that you have sent your offer and your earnest money deposit you will begin the negotiation stage with the seller of their agent. Generally, your agent will handle this phase and advise you of any demands of yours the seller has rejected or the demands they may be making on you. Once your negotiation is complete and your final offer is accepted you will enter into the next phase, which is the escrow phase.

Some things that will be negotiated include:

-Final sale price.
-The inspections to be done.
-Who will pay what closing costs.
-When the closing date will be and when the transfer of ownership will occur.
-Special considerations of things to be included or excluded from the sale.
-Special considerations such as carpet replacement or roof repair that are not part of an inspection.

Inspections:

You may want to consider the following types of inspections to be requested as part of your negotiations. Once an offer is accepted the inspections can be done and any findings will be resolved before closing. Note: these vary by State and by County - check with your agent for more details about the inspection and costs.

Structural Pest Control Inspection:

"Termite Report" - conducted by a licensed inspector - termite damage, pest report which analyzes the wood damage that may be present including fungi or "dry rot".

Physical Inspection:

Typically done by a general home inspector, a physical inspection is a visual review of the overall condition of the property.

Geological Inspection:

Evaluates the soil conditions at the home. Typically done by a geotechnical engineer, it involves physically inspecting the property and researching past geological activity in the area.

Other Inspections:

-Property hazard disclosure report
-Hazardous materials
-Well and septic
-Water conservation
-Structural engineering
-Chimney inspection
-Heating and air conditioning
-Zoning and building permit compliance
-Energy audit
-Roof inspection
-Pool/Spa inspection

Article provided by Old Republic.