How to Make an Offer on a House

Article courtesy of Zillow find another home to buy after theirs sells, so take a holistic view of the situation and see how your offer can meet their needs and yours.

If you need room to negotiate, make your offer lower than the maximum price you’re willing or able to pay. In a sellers’ market, where homes are selling quickly and over list price, that may mean shopping for listings below what you can afford. You’ll also need to determine when you want to officially take ownership of the home, and what contingencies including inspections and appraisals you want to include in the offer.

5. Draft and submit your offer

Your offer should be in the form of a purchase and sale agreement. Your agent will draft this for you and you’ll sign or e-sign before it’s submitted.

If your offer differs substantially from the asking price, you should consider including a letter summarizing the market conditions or comparative market analyses that led to your offer. The seller’s agent is legally bound to provide anything you present in writing to the seller. A respectful letter can help them understand your offer and your interpretation of the market condition.

The purchase and sale agreement becomes legally binding if the seller accepts your offer. At that point, you’re buying a house, and the purchase and sale contract will become a key part of the paperwork that guides the sale.

6. Seller replies: yes, no, or counter

Upon reviewing your offer, the seller might accept your offer as-is, decline the offer altogether or counter the offer to start the negotiating process. If the seller accepts your offer, they will sign the purchase and sale contract. If they decline your offer, negotiations end. If they counter by offering terms, you can either accept some or all of their counter offer or counter back.

It’s common for the negotiations to go a few rounds, with the buyer and seller providing counteroffers back and forth, usually with the advice and assistance of their agents. Price isn’t the only thing that can be negotiated. You might also find yourself negotiating repairs, contingencies, furnishings or fixtures and closing timeline.

7. Sales contract is finalized and signed

Once both parties agree to the deal — including price, inspection, negotiated repairs, closing date, etc. — the contract is updated accordingly and the home is officially “under contract” and the listing will typically show the sale as “pending.” Assuming all goes well with contingencies and financing, and depending on your close date, you’ll be a homeowner in about 30-45 days.

What does a real estate offer contain?

While some elements of your offer will vary based on your location and market conditions, a few basic items can be found in all property purchase offers:

• Property address

• Buyer’s name

• Seller’s name

• Offer price

• Earnest money amount

• Contingencies (like financing, home sale, inspection or appraisal) or waived contingencies

• Identification of title company or closing attorney (where applicable)

• Credits, if you are requesting them as part of the offer

• Offer expiration date and time (the offer submission process can be lengthy, so most buyers add an offer expiration date and time to encourage sellers to act quickly, and give the buyer a chance to explore other options if the seller takes too long)

• Proposed closing date

Can anyone make an offer on a house?

Yes, anyone can put in an offer on a house, and they should be aware that residential purchase and sale contracts are legally binding. Once you are under contract, it will be difficult to back out of the deal other than through a contingency clause in the contract. Such contingencies include things like inspections, clear ownership records and the ability to secure financing, all of which have to align with a timeline for getting them done. If, for example, you included a contingency for a home inspection that will take place within two weeks, and your inspector discovers that the roof has a leak, you can back out of the contract or ask the seller to repair the roof or reduce the price so you can have it fixed.

Backing out of a contract that has no contingencies or when the deadline for a contingency has passed may mean that you lose the earnest money you put down when you made the offer.

How much to offer on a house so the seller will accept

The best way to entice a seller into accepting your offer — or