Complete Purchase Offer
The Purchase Offer is the official “contract” that your agent sends to the seller —– it not only lists your offer price, but also your contingencies. Simply put, a contingency is a stipulation that must be met in order for you to be willing to move forward with that price. Take the time to review the offer in detail. Once you sign it, you are legally bound to its terms.
The Purchase Price
This is the amount you are offering to pay for the home.
Your agent will have already gotten a verbal okay from the seller’s agent on the phone (or in some states, this is done in writing), so the price should be no big surprise by the time it’s going into the Purchase Offer.
Earnest Money Deposit
“Good Faith Deposit”
This is a deposit you submit with your Purchase Offer to show that you are serious (and it eventually gets put towards the purchase price). In a buyer’s market, you might only put down $500. But in a seller’s market, you might need to put down up to 10% of the purchase price as earnest money — which is a big chunk of change. Your agent will be able to tell you what an appropriate amount would be in your specific case.
If your Purchase Offer is rejected, the earnest money gets returned to you. If the deal falls through, though, for reasons that are your fault, you may lose your earnest money in the process. Your agent will help you understand how much earnest money makes sense in your case.
This is the date you expect to transfer the title and deed from seller to buyer.
Make sure you are free to attend the closing in person whenever possible. And plan to take at least half a day off work to do so.
This is the date you expect to physically move into the property. It may be days, weeks, or even months after you legally “close” (or own) the home.
In some cases, the seller may ask to stay in the home for a few days or weeks after closing (and offers to pay you “rent” for the privilege). In cases where you were not ready to move in anyway, this might be fine, but you don’t need to allow this. You might also choose to get repairs (or renovations) done before you move in.