What do I need to know before I make an offer?
1. Negotiations are best done in writing and presented in the contract. Once the contract is signed it is harder to negotiate for something new. Don’t assume anything.
2. To present the offer to the seller your agent will need to have your pre-approval letter from your lender, proof of funds – that is the money you will be using for your Earnest Money Deposit as well as they money you will be bringing in to close escrow (all money other than your loan). It is best to print a copy of your bank statement, remove all account numbers but leave your name and give a copy of this to your agent.
3. If the home has been pre-inspected, be sure you have read and understand all of the inspections. Sellers are required to fill out disclosures, one of which is called the Real Estate Transfer Disclosure Statement. Read that document thoroughly – it tells you what is in that home (heater, air conditioner, garbage disposal etc), gives you information about the structure (type of roof, age of roof etc) and it tells has happened in that home during the time the seller has owned it. Look for a 2nd form called the Seller Property Questionnaire. It is a more in-depth look at the history of the home. Both of those are important disclosures the seller makes to you. Read them and write down any questions you have or anything that isn’t clear.
4. Have your agent contact the seller’s agent and find out if there is something special the seller is looking for. Sometimes sellers need a few extra days to get their next home closed so they can move in. Sometimes they need a long close of escrow, sometimes sellers don’t want to be asked to do any repairs. Knowing what is important to the seller and including them in your offer gives you an advantage.
5. Put yourself in the shoes of the Seller. What would you want to know about someone making an offer on your home? If the seller has lived in the home a long time they may be very attached to the home, they may have raised children there, shared the home with a spouse, and they will be curious about who will be buying their much-loved home. Plan to write a compelling letter to the seller about yourself and your family. Tell them about you and why you want to purchase their home. We have seen this swing the deal in more than a few situations. Include a family photo if so inspired.