When a buyer finds the “perfect” property it is time for them to sit down and write an Offer To Purchase to the seller. The buyer must take careful consideration when doing this. They must make sure that they are not overpaying for the home, so there is not an appraisal problem. On the other hand, they must be sure that they are not “low balling” the seller, alienating them from all future negotiations. Typically, the seller is given a specified amount of time to respond to the offer; to either accept the offer or make a counteroffer. Some sellers opt to do neither.
If the seller does accept all of the terms of the offer to purchase, they sign and have a legal binding contract in force. However, if the seller decides to change any part of the contract, the contract is still open for negotiations. The buyer must either agree to the changes or adjust the contract to suit his needs. It is then re-submitted to the seller to see if he agrees. As long as the contract is still in negotiation stages, it is open-ended. Either party may withdraw, or another buyer may come in with a different Offer To Purchase.
When all the terms of the contract are agreeable to both buyer and seller, the negotiations are complete. At this point, both parties are committed to moving forward. It is not uncommon for either buyer or seller to get a case of the "jitters" or "buyers or sellers remorse". All of the contingencies in the contract must be met and signed off on, in order to proceed to closing.
Offers to purchase property vary depending on the type of property being purchased and the buyer and seller wants and needs. Some things that an offer will include are:
The buyer and seller names.
The complete address and legal description of the property.
The negotiated sales price. The amount of the down payment, and the amount being financed. Financing contingencies. (The buyer must be able to get a formal loan commitment within a specific number of days.)
Contingencies, and time frames, for certain criteria to be met, such as satisfactory home inspection, termite inspections, mold inspection.
Every item that remains with the house should be listed on the contract, including appliances, window dressings, and any miscellaneous items. If it’s not written down, things can become difficult for both the buyer and the seller on closing day.
Any special addendums to the contract:
The closing date.
Any other item agreed upon by the buyer and seller should be in writing, or it is not enforceable.
A buyer’s offer to purchase your home can become a legal binding contract very quickly. Be sure your wants, needs and expectations are being met and that both parties fully understand the terms of the contract before signing.