New Home Buyers FAQ's Part 2: Making the Offer

In my last blog post, we answered questions about finding the right home.  Today, we’ll answer questions about making and offer.  Remember, you don’t have to know everything; that’s why you have your Edge of the Wilderness Realtor to guide you through the process. So, now that you’ve found the prefect place, what’s next?  Read on to see if we can answer the questions you might already have:

 

  • I know what the seller is asking, but how will I know how much to offer?  Your realtor can help you with determining your offer price but the decision is yours.  And remember, it’s not always about the money.  Are you pre-approved?  Are you asking for help with closing cost?  Will your offer be contingent on selling another home or on an inspection?  How quickly do you want to close?  All of these items can come into play when writing an offer.  
  • What’s are contingencies?  Contingencies are also part of the purchase agreement where the buyer is staying “I will pay your this much for your property, BUT these things apply to my offer”.  For example, one contingency might be a home inspection.  Another might be a septic compliance and a well test.  If you currently own a home but have it on the market, you might choose to have a contingency based on the sale of your current home.  Talk to your Edge of the Wilderness Realtor. 
  • What’s earnest money?  Earnest money is part of any purchase agreement.  It is part of your commitment to purchase.  You’re saying “yes, I want to buy your property, here’s my deposit”
  • How much earnest money should I put down?  This is your opportunity to show the sellers that you are serious about purchasing their property. While there isn’t a set amount of money you need to put down, go in strong but stay in your comfortable level.  
  • What happens to my earnest money?  Your earnest money is deposited into the seller’s broker’s account.  The buyer will see a credit on their settlement statement at closing.  In other words, the earnest money is returned to the buyer as a credit when we close.  If, the seller meets all of the requirements of the purchase agreement and the buyer secure financing but decides at the last minute to walk away without cause, the seller may get to keep the earnest money that the seller deposited.  
  • Will I get my earnest money back if the contract is not accepted?  Absolutely! 
  • What is the process for getting my earnest money back if the contract is accepted and the home inspections finds an issue? If, after the home inspection, the buyer decides that the home has too many repair issues to move forward, earnest money will be returned to the buyer.  It’s just a matter of canceling the contract, having both buyer and sellers sign the cancelation, and then a check is mailed to the buyers address.