So you’ve found a place you love. It has everything, or most everything on your wish list. It’s in the right price range, is a good investment for now and the future, and it’s in a part of the city you love. You’ve decided it’s the place for you and now you’re ready to make an offer. But what exactly is an offer to purchase? How does that process work? And how can you make sure you do it right? Here is some essential information on making an offer to purchase so that you do it right and get the price and move-in date you want.
Offer to Purchase Essentials
An offer to purchase is a legal and binding contract between two parties, a buyer and a seller, often made for large purchases like homes or other real estate. It is colloquially known as “making an offer” and should include all of the following:
• The property’s address
• The sale price
• Terms of the sale (such as method of payment, mortgage, etc.)
• A target date for closing the sale
• Down payment, the legal parties through which that money will travel, and what happens to that money if the deal is not completed under different circumstances
• Stipulations on who pays for land survey, inspection, etc.
• Deed to be given
• A clause that entitles you to a last-minute walkthrough before making the official purchase
• A time limit
• Additional conditions
Be sure that all of these are covered in the offer to purchase and that you agree to all of them.
The Offer to Purchase as a Bargaining Tool
When you make an offer to purchase, there are things you can include that will sweeten the deal for the seller, and make it easier for you to secure the purchase. Use the offer as a chance to hash out some details and see if you can get a better price based on the circumstances. Most sellers, for example, would much rather have someone show up with the cash than a mortgage, especially since the mortgage can cause undo complications. Without one, however, the purchase is simpler, and that may encourage them to sell at a lower price. Mentioning that your sale isn’t dependent on another sale, like the house in which you currently live, is also a big bargaining chip which can see a lower price, if you play it right during the negotiations.
An offer to purchase is a key part of the buying process and so much more than the formality that many people think it is. If you’re buying a new home, be sure to pay close attention to the offer to purchase. It will outline all the details, help you get the price you want, and smooth out any complications or have any surprises