What to Include When Making an Offer
Besides addressing legal requirements, an offer should specify price and all other terms and conditions of the purchase. After the offer is drawn up and signed, it will then be presented to the seller by a real estate agent, by the seller’s agent, or often by the two together. See: How to Write a Buyers Office Letter to a Seller. Your offer is binding. That’s why its so important that the contract clearly states everything. Offers should include the following things.
•A legal description of the property
•Seller’s promise to provide clear title (ownership)
•Expected date for closing (the actual sale)
•Amount of earned money deposit accompanying the offer; it could be a check, cash or a promissory note. It should also describe how the earnest money will be returned to you if the offer is rejected (or kept as damages if you back out of the deal for no good reason)
•Method by which taxes, fuel, water bills and utilities are to be prorated between the buyer and seller
•Terms about who will pay for title insurance, survey, termite inspections and the like
•The type of deed to be granted
•Other requirements such as disclosure of specific environmental hazards or other clauses
•A provision the buyer may make a last-minute walk-through inspection of the property just before the closing
•A time limit after which the offer will expire
If your proposal has “contingencies,” you are saying you will go through with the purchase only if that event occurs. One contingency is the matter of finances. The buyer must be able to get a loan from a bank. If the buyer can’t get a loan, they are not bound by the contract. Another contingency is the inspection. If the property doesn’t get a good inspection within a certain amount of time, the contract becomes void. Read: Anatomy of a Buyer’s Offer.
In terms of price, you’re in a very good position to negotiate if: you are an all cash buyer, you have been pre-approved for a mortgage, and/or you don’t have a house that must be sold before you can afford to buy.
In those circumstances, you may be able to negotiate discounts from the listed price. It’s very helpful to find out why the house is being sold and whether the seller is under pressure. Keep these considerations in mind: every month a vacant house remains unsold represents considerable expense for the seller. And, if the sellers are divorcing, they may just want out quickly. As well as the fact that estate sales often yield a bargain in return for a prompt deal.
You’ll also need to put a deposit down
Earnest money is a deposit you put down with your offer on a house. A seller is understandably suspicious of a written offer not accompanied by a cash deposit to show good faith. A realtor or an attorney usually holds the deposit. The amount becomes part of your down payment.
Can you withdraw from an offer?
In most cases the answer you can retract an offer right up until the moment it is accepted. If you want to revoke your offer, be sure to do so only after consulting a lawyer who is experienced in real estate matters. You don’t want to lose your earnest money deposit or get sued for damages the seller may have suffered by relying on your actions. See: 4 Rules to Live By When Making an Offer – US News.