Buyer's Guide - Page 5

You’ve found the perfect home, now what? Once you have found the house you want to buy, it is time to make an offer. Your offer will be presented by your Houlihan & O’Malley Realtor® to the seller’s Realtor.® Offers are often presented in writing, but sometimes they are made verbally. 5. Make an offer and negotiate An offer consists of four components: 1. The price you are willing to pay 2. Your preferred closing date 3. How you will finance the purchase, e.g. what percentage of the purchase price you will be borrowing 4. The contingencies of your offer (most commonly inspections and mortgage approval) Financing the purchase: If you plan to pay cash for the property, you should be prepared to provide the seller’s Realtor® with a “proof of funds.” In other words, you will need to provide copies of your bank or brokerage statements. If you plan to borrow a portion of the purchase price from a bank, you will need to provide a copy of your pre-approval from your lender with the offer. Accepted Offers: When you and the seller have reached an agreement on price and terms, it is called an “accepted offer.” This is a non-binding agreement that needs to be put into writing as soon as possible, i.e. a signed contract of sale. This is your “due-diligence” period – the time between accepted offer and a signed contract of sale. Contracts are not subject to inspections, so the next thing you should do is set-up all the inspections that you would like to execute before you sign the contract of sale. Typical inspections include: • Home inspection • Termite inspection • Radon testing As soon as you have achieved an accepted offer, you need to provide your Houlihan & O’Malley agent with your attorney’s information so that the seller’s attorney can send your attorney the draft of the contract of sale. Once all the terms of the contract have been negotiated, including any inspection items, the contract is ready to be signed. Typically you meet with your attorney to sign the contract and provide a check for the contract deposit, which is usually 10% of the purchase price. After the buyer signs the contract, the seller signs, at which point you have a fully-executed Contract of Sale. • Oil tank testing (if applicable) Counter offers: Usually, your initial offer will be met with a counter offer. At this point you will find out, if you haven’t already, the timing the seller is looking for and the seller’s comfort level with the financing contingency that is part of your offer. Successive counter-offers will be exchanged between you and the seller until a mutually satisfactory agreement is reached or the negotiations breakdown. HOME BUYER’S GUIDE 914.337.7888 5