Sooner or later, it will happen…you will find “THE ONE”. You may know as soon as you pull into the driveway, or maybe when you walk through the front door, or see the kitchen, or step foot into the backyard, or the finished basement. There are any number of home features or simply an “at home” feeling that let you know when you find yourself in a home you wish to call your own.
Sometimes a buyer makes up their mind immediately before leaving the property.
Some wait until they are in the car and have an opportunity to chat privately with their significant other.
And some sleep on it for a night, or two,…or a few.
But there comes a time when you will say “I/We want this house!”.
The inevitable next words are, “So, what do I/we do next?”
First of all…we act fast! Especially in today’s market, properties can come and go very quickly and often times more than one person will submit an offer for the same home. That’s why as soon as you make the decision to jump in and fight for that one, we need to get to work and prepare to compete.
I will first reach out to the listing agent to inquire if there are currently any offers in hand (or anticipated) and I will let them know of our intent to submit an offer.
You and I will then discuss offer strategy and an appropriate offer amount. Based on comparable sales, current market conditions, days on market, existence of competitive offers, experience, etc. I can advise what I believe it will take in order to win the deal. But in the end, it comes down to how bad you want it and what you are willing to do and spend to get it. Only you know the answer to that and I always want any decisions made through the entire process to sit well in your own head and heart. Of course you and I both want to get you the best deal possible, however, often times I witness buyers struggle with bumping their offer price up a thousand or two more when, in fact, over the term of a 30 year mortgage, $1,000 more could translate into only $5 more dollars a month (consult with your lender for specifics). At those times you will need to ask yourself, is it worth loosing your dream home to another person over $5, $10, even $20 a month?
Some other items we will discuss in preparation of writing the offer include what personal items (typically appliances) will be included in the sale, when closing is anticipated to take place and when you will take possession of the home (at closing or some time after).
Once the offer details is discussed and determined, I will begin drafting an offer package with your assistance.
What is needed from the buyer in order to write the offer:
- Full legal name(s)
- Current street address
- Phone number
- Marital status
- Offer amount
- Pre approval letter written for offer amount (Including loan type, % down payment, years financed) or proof of funds (for cash purchase)
- Earnest money deposit check (EMD)
Of those items, the one that always generates the most questions is the Ernest Money Deposit or EMD.
What is the EMD? It is a deposit. It’s what you put down at the time of offer to show good faith that you will uphold your end of the contract for the purchase of a home. I recommend the amount of EMD be around 2% of your offer price. This is a personal or cashiers check from your own bank account. In most cases, it will be made out to Moving The Mitten (bank owned sales sometimes have other requirements).
What happens to my EMD? As soon as your offer is accepted, this check is cashed and the funds held through the process in the broker’s escrow account. As long as you hold to your end of the agreement and move forward with the purchase, these funds get credited to your bottomline at the time of closing. If you terminate your contract for reasons within your allowable contingencies (typically inspection, appraisal, financing), your EMD will be returned to you. If you choose to terminate the agreement for reasons other than your contract contingencies (typically inspection, appraisal, financing), you will forfeit your EMD.
Once I compile the entire offer package, I will send it to your email for electronic signatures. Please review the documents and always feel free to reach out to me to ask for clarification on anything that is unclear or confusing. Then sign.
Once all signatures are received, I will forward the package to the listing agent right away. Then we wait for an answer…with fingers crossed and happy thoughts.
