When you walk into the right house, you'll know it immediately. Once this happens, be prepared to:
1. Evaluate Quickly - If you're in a seller's market, you will need to write an offer that day. Let us know that you like a property and we'll review the comparables, determine a realistic offer price, and discuss the financing (so you are comfortable with the monthly payment).
2. Make an offer - Together we will sit down and complete the Offer to Purchase, discuss the elements of the contract and strategize your position.
Question: What if another offer comes in at the same time? Will the other person outbid me and get it?
Answer: Maybe, but remember every seller has different motivations and variables that play a factor is their decision process. Price is usually the biggest factor, but not always. They look at the other terms of the offer as well; such as, closing dates, required repairs, and other contingencies. Often a pre-approved buyer, who makes a "clean" offer, will be more attractive then a non-approved borrower who offers more.
3. Receive a counter-offer from the seller - this is common practice. We all have a common goal, the seller wants to sell and the buyer wants to buy. Be prepared to be flexible and ready to negotiate on price, closing date, repairs, and contingencies. Remember, being pre-approved gives you an advantage over other buyers. The fewer contingencies in your purchase agreement, the stronger your offer.
Question: What is a contingency?
Answer: A contingency is an item in the sales contract that could prevent you, as the buyer, from completing the transaction. Here are a few examples:
- Sale of your home. You currently own a home, so the purchase of the new house is contingent upon the sale of your current home.
- A physical inspection. This allows the buyers the opportunity to satisfy themselves regarding the structural integrity of the property.
- Home loan qualification. The buyer must qualify for a loan in order to purchase the house.
4. Pay good faith earnest money - once your offer has been accepted, you will need to deposit a good faith/earnest money check into escrow. You must have these funds liquid and available.
5. Contact your mortgage broker - to let them know you are in escrow and provide the pertinent information to complete the loan.
7. Prepare to attend your physical inspection - in the next 10 days.