After all the searching, you have finally found the right home! Now, you want to make a strong offer, but you also want to get the home for a fair price.
There are a number of factors that will affect your decision on what to offer on the property. Market conditions are always a factor. For instance, if it is a “buyer’s” market, you will have some more negotiating room for the property. In a “seller’s” market, you may want to place your best offer up front in order to be the one chosen by the seller.
Also to be considered are the values of the properties around the one you want. These figures are typically called the “comps” or “comparables”. I will show you all of the properties on a list that have closed or are for sale currently in the vicinity of the property you are submitting an offer on. These comps must be analyzed and a realistic value for the property established. There will be an appraisal on the property after you are under contract, and often what you are willing to pay for a property and what an appraiser determines as its value are two different numbers!
You will also want to establish the closing date, or date you will actually become the owner, before writing an offer. If you are obtaining a loan, a lender will generally need about 30 days to complete your loan, order and evaluate the appraisal, and furnish the closing documents. If you have been pre-approved, this time frame may shorten. Of course, you will want to give yourself ample time to conduct any inspections on the property prior to your chosen closing date.
An offer to purchase property is a legally binding document, and I’ll explain it to you in detail. You should always feel free to consult an attorney or tax advisor to obtain any further information you deem necessary. I want you to be prepared, but also enjoy this exciting experience. Anything I can do to help, just ask!