I Know what I want to pay for the home but now I need to put it on paper and include all aspects of what the offer is. It needs to include what the seller is doing, what the buyer is doing, and who is paying for what, and how that payment is to be handled. It should also included where the closing will be done, who is drawing up papers, and where the escrow is being held.
It sounds like a lot and is. You can typically pick up a form that you can find at your local stationery store that will have a fill in the blank approach for most of the information that will be included. You may want to pick up an addendum form for any additional information items or conditions of the offer, including conditions of the offer that there is not room on the basic offer form to include or that you want to add.
I am not going to go into the details of actually writing the offer. If your not comfortable with it and are not using a realtor then I would highly recommend an attorney for at least the first one or two you do. You want to make sure the attorney has your interests in mind, so this should be an attorney that you have used before or if not pay him a retainer. You want to make sure you are protected and free advice from an attorney or anyone else is not what I would want to bank on. And we are talking about your bank account here, not mine!!!
I have a disclaimer link at the bottom of these pages but am going to say it again. I am not a lawyer, realtor, account, appraiser, contractor or licensed inspector. These articles come from my personal experiences and opinions only. I always recommend you read the article I have on this site titled “Who are your exports and support people?”.
Now back to that offer that we are discussing. Again due to the differences in how transactions are handled and laws and ordinances that vary so much from state to state and even county to county this is going to have to be in generalities rather than specifics.
So the first thing is that everything is negotiable. When you are putting together or writing the offer there are going to be things that are always typically done. However that does not usually mean when you are offering to buy that home that you have to do it that way unless there is an actual law saying so. The example in this case is who pays for title insurance, who pays for the papers being drawn up. You can ask for the seller to pay for these things, or some of these things or none of these things.
If a realtor is writing the offer for you and objects to some of your requests in the offer, be insistent, its your money and your making the offer. If the agent tells you they can not do it then it may be time to find a new real estate agent.
If your doing bank financing or convential financing your offer will have to be pretty straight forward and clean of a lot of creative conditions and requests. If your asking the seller to carry the note or to finance the property or your paying cash then you may have some more room to be a little creative in your offer. It will also make a difference on how motivated the seller is as to how creative or what conditions you may put the offer contingent on.
Now there are two thing that I do with every offer that have saved me a lot of pain , grief, and money. First is for my earnest money, I always use a promissory note rather than a check or cash. And the important part of this is I write on the bottom of it “redeemable only at closing”. Run this and my other suggestion by your attorney before actually doing it. But what this does is the only way I have to make good on the promissory note is if the property actually closes. Otherwise it is worthless and can not be collected on. No money out of my pocket if the real estate transaction never goes through.
The other one that I always try to get on any offer to purchase is my contingency or get out of the contract statement that I use. Anytime any one asks me what it is I just tell them it is legal jumbo mumbo my lawyer says to put on all my offers. the statement is “ Subject to my absolute discretionary approval at final walk through”. If the offer is accepted that statement give me an escape clause out if for some reason I change my mind or need to get out of the deal. Again run this by your attorney before you use it.
Now that we have the offer we just need to present it. I am going to have it all written out and just needing signatures from the seller and myself. I am not going to hand the offer over. Instead I am going to actually sit down with the seller if possible and present or tell them what’s in the offer line by line. The thing the seller is most interested in is usually the price and how much money they will get. So that is usually the last thing I provide. I want to keep their attention so I can sell them on me and why they should accept my offer as well as what has to be done to the house and what it is going to take in time and money to get it ready. And my offer is usually only open for no more than 48 hours. before it expires.