After you have found a home that you love, it’s time to make an offer.

The first step is to figure out the price you are willing to pay for the home. Ask your broker to conduct a competitive market analysis for the home you want to make an offer on. A “CMA” is (Competitive Market Analysis) “a report that real estate agents generate to estimate a home’s current market value. CMAs are based on an examination of {sold} similar properties in the area, taking into account factors such as size, condition, style, location, age, construction, and special features.”- Investopedia After you are set on a price, you need to be aware of any additional contingencies you need to add to your offer.  Added contingencies are things like having a specific period to do a home inspection or reviewing all the bylaws and financial documents for the HOA.

After you have figured out your contingencies, decide how much earnest money  you want to put down. Earnest money is typically 1-3% of the selling price of the home. The more earnest money you offer, the more likely it is that the seller will accept your offer. This money will go into an escrow account and will be held until later, then applied to your down payment at closing.

After you have decided your asking price and earnest money amount it’s time to make your offer. Have your realtor help you fill out a purchasing contract with your offer. The purchasing contract includes a lot of the nuts and bolts of the real estate transaction and includes many different essential things including your offering price, the home inspection, specifications about your loan, the duties of all parties to each other etc. The contract is super long and a bit tricky to navigate but your realtor will help you fill out and explain everything on the contract. After you have submitted your purchasing contract it’s time to move onto the last step!

The last step in making an offer is negotiation. If your offer is accepted and the purchasing contract is signed, you are on your way to buying the house! If the seller rejects your offer you can write them a new offer (ONLY if they are still accepting offers) or move on and keep looking for your dream home; But what do you do if the seller comes back with a counter offer. If the counteroffer is reasonable like the seller wants a bit more money or the seller might want to shift the closing date you can simply sign the counteroffer and be on your way with an accepted contract.  But if the seller counters with unrealistic demands, for example a huge increase in the offered price, you can either reject the counter and move on, or write your own counteroffer and send it back to the seller in hopes that they will accept it. The choice is up to you, accept the counter, reject the counter or counter the counteroffer. 

Now let’s hope that with maybe a bit of negotiation you and the seller have come to an agreement on the home. You are ready to move on to the next step which is a home inspection!