Making an Offer
After touring numerous properties, attending open houses and thoroughly reviewing the seller disclosures, inspection reports, and HOA documents, you’ve decided to make an offer! The real estate market moves very quickly so we need to submit your offer to the listing agent as soon as possible, preferably within a few hours.
There are some critical pieces of information Dawn will need to submit an offer on your behalf. Some of this we may have already discussed in advance, but let’s take a moment to review.
Full Legal Name
We will need the complete legal names of all persons who will be on the purchase contract as well as their primary phone number and email address.
Dawn will offer her guidance on an offer price based on her knowledge of recent sales in the neighborhood. But, the final decision comes down to you and what you feel comfortable paying for the home.
Your Walk-Away Price
It is possible that the sellers may come back with a counter offer on your initial offering price. Because of this, you should have a ‘walk away’ price in mind. This is the threshold amount that you are willing to pay for the home.
A typical escrow period is 30 to 45 days from the acceptance of the contract. This timeframe varies (all cash offers are usually less time) but if you are securing a mortgage, you can expect escrow to be from 30 to 45 days. Consulting with your lender can give us a better idea of how much time will be needed.
Part of your down payment, called an earnest money deposit (EMD), is paid within a few days after contract acceptance. These funds are a guarantee to the seller that you are serious about purchasing their home. The title company holds the EMD in an escrow account for the duration of the contract period. Dawn can help you determine an amount that would appeal to the sellers as well as meet your level of financial comfort, but you can expect to provide approximately 1 to 2% of the offer price as an earnest money deposit.
The total you will be putting toward your down payment needs to be included in the initial contract. Remember that your earnest money is part of this amount, but is paid upfront. If you want to avoid paying Private Mortgage Insurance (PMI), you will need to put down at least 20%.
Closing Cost Credits
Do you want to ask the sellers to cover any fees associated with closing costs? These fees are part of purchasing a home and are in addition to your down payment. Dawn can help guide you on this point if needed.
If you want to ask the sellers to pay for a home warranty, this is something we should include in the initial offer.
Do you have special circumstances that warrant including a contingency, such as selling your current house? Dawn can also provide insights as to whether we should include property, loan, or other contingencies in your offer.
All of this information will be included in your offer to the seller. Before we send it to the seller’s agent, we will email it via Docusign to you and anyone else listed on the contract for electronic signature. Because timing is of the essence, you should sign the offer as soon as you receive it. The Dawn Thomas Team will then send to the listing agent.
Once your offer is in the seller’s hands, things could be decided quickly or it could take a day or two, especially if there are multiple offers to be considered. Rest assured, we will keep you apprised of the situation and be in communication with the seller’s agent in the event they have questions or want to counter your offer. If they do counter, Dawn will contact you to discuss their revised offer so you can decide if it is acceptable or if you would like to continue negotiations.
Before we move on, let’s talk a bit more about home warranties.