KAMLOOPS REAL ESTATE
HOME BUYER'S GUIDE: THE OFFER
After a thorough evaluation with a REALTOR®, before showing your home, you should have the following: a realistic idea of the price, how low you'll settle, what conditions you'll accept, and what terms would be agreeable. This helps you to be ready for when an offer is presented - you'll be able to compare it to your initial guidelines. Your REALTOR® will evaluate these offers with you and together hopefully arrive at one that comes closest to your objectives. At the same time, your REALTOR® will likely exercise some leveraging power with any other negotiable items. It comes down to persuasion and negotiation and your REALTOR® has specialized training in this crucial area.
Evaluating the Offer
When you've found the home you want, you'll need to make a formal written offer. This is called an offer to purchase. This is a legally binding document that should be completed with due care and diligence. This document outlines what you the buyer will give to the seller in exchange for the home.
It's highly recommended that a lawyer or REALTOR®, lawyer, or notary prepare the offer on your behalf. This will reduce any financial or time related errors. Always review the offer/document before signing. As always, if there is anything you don't understand, be sure to ask for clarification. Once signed, the document is binding and you could face consequences upon default!
An interested buyer will present an offer to your REALTOR® through his or her agent. Your REALTOR® will discuss the offer with you, ensuring you understand all aspects. The offer should clearly outline all terms, conditions and details of the sale. Your REALTOR® will be able to ensure the contract is sound.
Keep in mind that the purchase price is not the final price you'll receive. That's because you'll have additional fees to cover from the sale of the home including lawyer fees, REALTOR® fees, bank fees, and taxes. You and your REALTOR® should thoroughly review every detail. If there's anything you don't understand, ask! Before you accept and sign the offer it's a good idea to have a lawyer or notary review the offer. This way you can be confident nothing has been missed, everything is legally accurate, and your interests are protected.
You and your REALTOR® can handle the offer in several ways according to your timing and needs. If you're not attached to the home you want to buy, you could try and present a very low offer. Low offers typically are considerably less than the asking price and appealing to a seller who is desperate to sell. The seller could present a counter offer or might turn down your offer completely and refuse to sell the home to you. Your REALTOR® can offer some professional guidance on presenting a fair and reasonable "low" offer.
When you've fallen in love with a home and you really want the home, you could present your best offer. This offer leaves no negotiating room, but if the market is hot it's an offer that will attract attention. Your REALTOR® can advise you on the best way of making an offer that's fair and reasonable without indicating to the seller that you're desperate. Why pay more than necessary?
An Offer Can Be Conditional or Firm
When your offer is firm, you're telling the seller you're willing to purchase the home without any conditions. Upon acceptance of the offer, you have purchased the home in a legally binding agreement. Upon default, or rather if you're unable to close, you could lose your deposit and face legal consequences. Be sure to confirm your financial matters prior to signing any documents. A conditional offer includes stipulations on the purchase. These could revolve around a home inspection, financing, or sale of your existing home. If any of these conditions aren't met then the home is not sold.
From Offer to Acceptance
Upon reviewing your offer, the seller can accept it, reject it, or return with a counter offer. A counter could be a change in price, conditions, closing date or other variables. The offers will continue between the seller and the buyer until both parties have come to some agreement or one party stops the negotiations. Once the offer meets with your approval, you'll want to secure the transaction with a deposit. This indicates your intention to proceed with the purchase. When you have accepted the offer you'll proceed through the closing details until you move in.
A sum of money, usually no larger than 3-5% of the purchase price, shows that you're serious about purchasing the home. This amount will be applied against the purchase of the home when the sale closes. Your REALTOR® will be able to help you determine what a reasonable and serious deposit amount is.