How To Make An Offer On A Home

How To Make An Offer On A Home

So you've found your perfect place and you are ready to make an offer.

Assuming you are working with a Hoboken real estate agent that has helped you determine market value for the home you are about to bid on, and you are armed with information, you will need the following three components to present your offer.

1. Put it in writing.

You will need to present your offer formally. Verbal offers don't count and most seller's will not accept or even negotiate verbal offers. So, put your offer, in writing, clearly highlighting the terms of your offer.

Your offer will need to include the following details:

• What your offer price is
• How much money you are putting as a down payment
• How soon you can close
• A good faith deposit
• Specific Terms (IE, you want the seller to pay a credit towards new appliances)
• Your signature

2. Mortgage Letter or Proof of Funds

If you are obtaining a loan to purchase this home, you will need to include either a "pre-qualification" letter or a "pre-approval" letter from the lender or mortgage broker. 

The difference between a pre-qualification letter and a pre-approval, is that a pre-qualification holds less weight because your assets and credit score have not been verified and checked. 

A pre-approval states that your assets and credit score has been verified and therefore makes you a stronger candidate. You should consider arming yourself with a pre-approval letter if your market is competitive.

If you are a cash buyer, you must show your assets. An account snapshot showing that your funds are liquid, will usually suffice.

3. Good Faith Deposit

Most agencies will take what is traditionally referred to a "good faith deposit". This is usually in the amount of $1,000 held in escrow by the broker you are working with in a non interest bearing account. This shows the seller that you are serious. 

If your offer is accepted, your good faith deposit is applied towards your down payment. If your offer is denied, you will be returned the good faith deposit usually within 10 business days, or you can use the deposit to reference on your next offer. 

Either way, this is expected by agents, so be prepared on appointments with your check book on you at all times. Because if you do make an offer without a good faith deposit, your offer can be dismissed as not strong. 

Now you are ready to make your offer. Good luck!