You probably feel overly excited when you find the right house and decide to place an offer on it. At the same time, though, you might feel nervous about writing the proposal. How much should you offer? What other details should you add? What if the seller rejects the offer? These are all legitimate questions to ask, and you should talk to your realtor about them. Your realtor can help you write the best offer, and he or she will help you know what to include in the contract. Here are some tips to help you understand your options when writing an offer to purchase a home.
Consider the Value of the Home
While you should consider the asking price for the home with your offer, you should also consider the value of the home. If the seller is asking $250,000 for a house worth only $200,000, you will need to keep the offer closer to $200,000. You should not pay more for a house than it is worth. If there is a big difference between asking price and value, you might want to pass up the home and choose a different one.
Secondly, your realtor will talk to you about contingencies. A contingency is a commonly used request in real estate deals, and it refers to a condition or request of some kind. Here are some examples of contingencies you can add to your offer:
- Financing – A financing contingency means that you can back out of the deal if your financing falls through.
- Appraisal – This one means that you can back out if the house does not appraise for the selling price.
- Closing costs – Asking for a closing cost contingency means you are asking the seller to pay some of these expenses for you.
- Repairs – You can also request that the seller fix things in the house.
- Furniture or fixtures – If the house contains something that you want the seller to leave, you can ask for it in your contact.
Your realtor can provide you with more examples of contingencies to use in your contract.
Look at the Bottom Line
Finally, you should consider the bottom line in your offer. To do this, view the offer amount minus any contingencies that will cost the seller money. The bottom-line offer should be favorable for you and the seller. If you have further questions about this, talk to a realtor today.