The Buying Process What Steps Do I Take Step 5

You now are at the point you want to write an offer for a property you have found.

What do you need to prepare to write an offer?

1. A pre-approval letter. By this point you have already met with a lender and have been pre-approved. You will want to have this letter submitted with your offer. This will let the seller know that you have been pre-approved and are able to purchase the home.

2. A check for the earnest deposit. What is an earnest deposit? This is the amount you will put down with the offer. This check is written out to a title company who is the neutral 3rd party and the handler of money. What this says to the the seller is you are a serious buyer. You want this house and you are willing to put money down to ensure you get it.

3. Determine offer price and terms. You have been researching homes and areas. Your Realtor has provided you with comparables to the property you are interested in so you know what other homes have sold for recently. You have seen the disclosures on the property. Your Realtor will have found out if other offers are coming in. With all this information you are able to determine what price you are going to offer for the house.

4. What are the Terms of the Contract? Terms of the contract are:

A. Appraisal Contingency
B. Loan Contingency
C. Inspection Contingency

What are contingencies? These are time lines that allow the buyer to get their loan approved, have the property appraised to ensure that the appraised value of the home is at least what you are offering to purchase it at and the inspection contingency allows you to have the home inspected to ensure everything is in good working shape, and that you have had time to research the neighborhood, review HOA docs, etc.
These contingencies have a finite time line that you the buyer can modify. This is what is the terms of the contract.

Taking these steps will prepare you to putting pen to paper and writing the contract. Stay tuned for my next Blog regarding writing the contract.

If you have any questions you can contact me at lcartolano@apr.com or at 510.213.1139