Making an offer

Once you identify a property you’d like to purchase, the next step is to make an offer. An offer is a legally binding contract that specifies an acceptable set of terms and conditions under which you agree to purchase a property. Work with your REALTOR® to analyze market value and develop a negotiating strategy.

TYPICAL OFFER COMPONENTS AND DEFINITIONS

• Purchase Price
  The amount of money to be delivered to the seller in return for the deed

• Earnest Money Deposit
  Typically broken up into two separate deposits due at offer acceptance and Purchase & Sale (P&S) signing, respectively

• Offer Expiration Date & Time
  How long the offer is valid (e.g., 48 hours)

• Purchase & Sale Signing Date
  Specifies the date and time by which the P&S is to be signed by all parties

• Closing Date
  Specifies the date and time by which the deed transfers from the seller to the buyer

• Escrow Agent
  Specifies which entity holds deposits

• Home Inspection Contingency
  Specifies the timeframe and terms for inspections

• Financing Contingency
  Specifies the loan amount and date by which financing must be obtained

• Inclusions / Exclusions
  Lists which items stay and which don’t

• Other Contingencies as needed
  E.g., Sale of Buyer’s home, Subject to passing Private Septic Title 5 Inspection Report

Once the seller receives an offer, they can either accept it exactly as written, reject it, or issue a counter offer. It is possible to go back and forth more than once before settling on mutually acceptable terms—but don’t count on receiving a counter offer, especially in a competitive offer situation. Once both parties sign the offer, it becomes a legally binding contract. If you are involved in a bidding war, your REALTOR® will help you develop a strategy to make sure your offer is competitive.

---

TIPS FOR SUCCESSFUL NEGOTIATIONS

Get down to business. Separate your emotions from the transaction. Focus on your long term wants and needs and avoid getting hung up on low impact terms.

Know what you want. Identify your ideal terms ahead of time. Know where you are and are NOT willing to compromise.

Think creatively. There may be multiple ways to achieve a desired outcome. Are there other factors you can lay on the table for discussion?

Put yourself in their shoes. Stay one step ahead by anticipating how the other party is approaching negotiations.